Monday, December 18, 2017

Limited initial follow-through

While there can be limited pullbacks in the range of pairs, the main drive should be Dollar bullish still. However, having written that, the follow-through should be relatively limited. How quickly this develops is a different matter. Very clearly we’re in the final 5-day week and even then the lunchtimes tend to get extended at this time of year. Not only that, the last three days of this week tend to be rather lacklustre while after the Xmas celebrations there are just three more days that replicate the three days before Xmas. So it’s best not to get too bold with position sizes.

However, there is one pair – USDJPY – that needs a deep pullback first. If this is seen, then it’ll need to play catch up to then follow the main Dollar bullish directional flow…

Another outlier may be in AUDUSD in seeing a Dollar bearish pullback before losses resume.

So over today – maybe two days if it’s really sluggish - we should see follow through but then a correction. The pullback appears to be modestly deep but, of course, it’s always the corrections that slow down the development.

Have a profitable week
Ian Copsey  

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