Commodity Dollars Are Having Second Thoughts
Skerdian Meta • 1 min read
The commodity dollars (AUD, NZD & CAD) have been suffering over the last few months, but in the last few, days they have fought their way back. Though this has more to do with USD's weakness, as we have mentioned a few times today.
USD/CAD was threatening 1.38 a couple of weeks ago but is now sticking around 1.36. NZD/USD and AUD/USD were sliding down a slippery slope until a few days ago, but they´re better off now. They were helped by some good economic figures from Australia and New Zealand, such as the Australian report last night.
But today, it looks like the Com Dolls can´t make their mind up about anything. USD/CAD climbed 100 pips higher since last night, but it has slipped about 60 pips over the last several hours.
We can say the same about AUD/USD, while NZD/USD hasn´t moved much at all. So, the Com Dolls have been in a downtrend for weeks/months. They retraced some of the losses over the last few days and are now feeling uncertain.
So, what´s the answer to this puzzle? The answer is that this retrace higher might be coming to an end, which means that the downtrend might resume soon.
This is how the forex game works, you try to find clues along the way, analyze them to be ahead of the market, then make the decision when the market conditions fall in place.
Right now might not be the right time to make that decision because the market is still in panic mode after the US political tensions, but the worries are wearing out, so we´re close and the daily forex charts are nearly overbought.