This text is from blog famous currency strategist Joel Kruger .
MID-WEEK CAPITULATION – I have often found that Wednesday is an ideal day for market reversals given its position in the middle of the week. I have also said that any additional EUR/USD upside should be limited to the 1.3200 area. The combination of these two observations would therefore make this Wednesday a formidable candidate for a compelling bearish reversal day. Technically, EUR/USD has now broken into overbought territory on the daily chart, with the RSI also warning of a near term retreat. As such, for today, my recommendation would be to look to once again attempt to sell the Euro on either a rally to 1.3160 (projected ATR high), or on a break back below 1.3045 (Tuesday’s low). Otherwise, just stand aside and wait for the next opportunity to present.
See forex daily technical analysis video made by Joel:
GRAVITY IMMUNE – Elsewhere, AUD/USD continues to track with a bid tone, despite a rate cut this week, and every piece of relevant economic data disappointing. The ability for this market to retain a bid tone has been more than frustrating, yet it seems as though renewed optimism over the outlook for the global economy and a perceived stabilization in China, have been the driving forces behind Aussie’s gains. Moreover, comments from Treasurer Swan overnight have also provided some intraday support, offsetting the below expectation GDP print, after the official said that he was pleased with the GDP result relative to what has been going on in the rest of the world. Still, while I would not rule out the possibility for additional gains in AUD/USD towards 1.0600, the realties of the softer economic data on the local front, and possibility for additional rate cuts ahead, should start to weigh more heavily on this pair going forward.
