Markets continue to get sold down as we head into the holiday period and clearly at the moment, the risk-off play is in control.

There are still some concerns in the air surrounding the future of US interest rates. Many are suggesting that the economy can’t handle more hikes. President Trump has clearly been unimpressed and has said as much on Twitter numerous times.

The action will come to a head this week as the FOMC meets on Wednesday and we should get a clearer picture of what might lie ahead. If the outlook is a little more dovish, the risk-off play might ease off as we move towards weeks end.

Today the key data points are business climate out of Germany and building permits from the US. There is an onslaught of data starting tomorrow, so I suspect it could be a very busy end to the year.

Forex Signal Update

The FX Leaders Team had a quiet day yesterday with only a couple of signals traded with both in the red, unfortunately.

EUR/GBP – Price is really coiling underneath the 0.9000 level in the EUR/GBP. This can at times lead to a breakout above resistance.

Gold – Active Signal

Gold has bounced back hard off key support at 1240 as the risk-off play was busy yesterday. The VIX continues to push higher and with markets selling hard gold is strong.

AUD/USD – Active Signal

The AUD/USD is holding below 0.7200 level after a mild update from the RBA today. There was little of interest, but the Aussie is now pushing up and looking to test the key 0.7200 level. Our stop is just above that point.

Cryptocurrency Update

Bitcoin has been the star performer to date and has rallied strongly off the lows and back into the key level at $3,500.

The fact that we couldn’t flush lower when sitting at the lows was a sign that the sellers had dried up. Now we have to watch closely to see how price responds at $3,500.

If it can’t hold, then I expect more selling to come. I am still looking for a test of $3,000 until proved otherwise.