The candlestick is a bit better looking than it was just a few hours earlier, but at this point I think it’s position squaring heading into the jobs figure.
The candlestick is a bit better looking than it was just a few hours earlier, but at this point I think it’s position squaring heading into the jobs figure. After all, a lot of people will be concerned about the possibility of a surprise, so we could get a sudden knee-jerk reaction to the upside. I do believe that’s a nice selling opportunity, because quite frankly the US dollar is going to remain very strong going forward, just as rates well. However, it is probably worth noting that the market doesn’t necessarily need to break down all at once. In fact, it’s probably more likely than not that it will be a grind toward the $1600 level over the next several sessions, if not even weeks.
I do like the idea of fading rallies, and just don’t have an interest in trying to get long of this market quite yet. Remember, when you are buying gold, you were essentially shorting the US dollar, and although you can make a serious argument for the US dollar being overbought in the short term, the reality is that the trajectory is still the same.
Because of this, any time that the market rallies and then shows signs of exhaustion, it’s very likely that the market will see plenty of sellers willing to jump in. Furthermore, the $1680 level remains a resistance area, and it is probably worth noting that the 50-Day EMA is sitting there as well. With this being the case, I think that it will be very difficult to break above there, and that the path of least resistance still remains lower. That’s not to say that we are suddenly going to take off to the downside and aggressively dominant, but I do think that is still the prison you need to look at this market through, trying to find shorting opportunities.
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