All right, everyone. Well, the pound is continuing its push into prior area of resistance. Remember, we’re really looking for the pound to get all the way up here, which is 5,680. But we’re breaking it down into chunks, if you will. And so, of course, we had the first chunk of resistance, which is really contained by the high over here and the low over here. You can see that there are several different areas where the market ran into trouble, for whatever reason, in this zone. And so now price has managed to push above it. We do have one more area of resistance that’s going to be this 4,980 5,000 handle resistance zone. And then, of course, we’ve got to walk price up to get even further.
I think, with the amount of dollars that are being pushed into the system, as well as, for all intents and purposes, the Treasury Department giving bankers carte blanche and bailing out Goldmann and bailing out all of the big international banks, flooding the world with dollars, I can’t really see any other reaction than for the dollar to go down, as individuals start to diversify into other currencies. If China, Japan, and Russia do start dumping their dollar assets onto the market, you’re going to see an additional push up as those players start to pour in.
I think there’s going to be a lot of pressure on the dollar. We’ll just go ahead and bring it up here. It is managing to stay fairly constant.
The thing to watch out for is going to be a break of this low, which right now is 83.14. Remember, this is the futures index, the DX index, which is the financial futures, rather than a basket of currencies. So keep that in mind if you’re looking to compare prices. Again, this price is 83.14 on the dollar. I think, if we do see a spike above that level, more than likely you’ll see the British pound getting above this prior high and then starting to work on this series, or that triple top.
As far as coming into tomorrow’s trade, we’re still looking for the little dipper pattern. We did see that once the market broke above our double top here, it struggled to get above here, and then finally pushed above, giving a little dipper and actually starting into this trading lane now on the hourly bars.
But, overall, it’s still a very, very sloppy kind of chart pattern, where we’re not really seeing much of a true test. What this indicates is that there is still buying out there. In fact, there’s enough buying that the market cannot truly come back to retest this whole breakout area, which, in and of itself, is bullish.
So, coming into tomorrow’s trade, we have break out above here, break down below there. Since we’re already near this level it is about 5:30 Eastern Time we’re going to have to, I think, at this point, watch for a retest in the Asian session for a possible move down.
But the high price, actually, 4,773, is pretty well set in stone. If we do get a break above there, even on an autopilot basis, I think that’s going to prove to be a good trade, up to about 5,000. Remember, 5,000 is this high over here, 4,990. And so I think, if we do manage to break to the upside, we’ll get a quick pop to that.
Comments on this entry are closed.