Bulls Control the Situation, Risk Mode Is ON
Market optimism can be seen all over the place. First of all, we have an impressive surge on stocks. Is there still anyone that thinks that we should get another leg down and that we didn’t just experience the V shape recovery (on graphs, not the economy)? Those riskier instruments like emerging markets currencies are also gaining a bit of traction. Let me show you three, potentially very promising trading ideas.
The first one is gold, where the price is going lower after a false breakout at the 1740 USD/oz resistance level. This week the price tested that area again and again, but were sellers victorious? The price is currently hitting lower lows and highs and as long as that continues, the short-term sentiment is negative.
Stocks are currently taking a small break too. Over the last three days on the DAX did really great. The price managed to climb significantly higher crashing all bearish dreams – if any were still left. Currently, we do have a small bearish correction but it looks just like a correction. In the recent upswing we already had two of them, very similar to each other. This one should end, when the price breaks the upper red line. In my opinion, there is no ‘if’ here, just ‘when’.
The EURPLN is a great example of a better sentiment towards emerging markets currencies. Maybe not this week but the previous two weeks for sure. The price ended the sideways trend that we had since the middle of March and went lower. Currently we do have a great looking hammer candle, which is promoting a further upswing. The place in which this formation is present is not random. The price is bouncing from the highs of 2018 and 2019. We already mentioned that this area can be a great bearish target and support. As it turns out, we were not mistaken.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
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