Some Respite For The Dollar In The Next 24 Hours?
Submitted by Nic Lenoir of ICAP
The topside resistance of the assumed-to-be bull flag pointed out this morning in EURUSD has held so far. A quick look at the dollar index over the last few days of trading indicates we are facing support here at least in the near term. Even if we cannot claim to have made a bottom in the medium to long term, it looks we should at least retest 75.80 before another wave of selling.
Crude Oil confirms it has lost any correlation with any other market, or reality for that matter. Some people think it is linked to the suicide bombing killing several members of the Iranian guard, personally I think it is simply the market reaching the "euphoria" phase of the bubble. This is when correlations break down, record for number of consecutive up days are broken, and we start hearing about $200 target projections. The latter hasn't happened yet to my knowledge... unless some analysts claim their predictions from last summer ignoring the 75% sell-off that happened in the meantime... We see targets at 80.94 and 91.19 for oil on this move. Personally I would not be surprised if we see the $91 mark. I would rather focus on trying to identify the top however than fueling the fire.