Gold, after triggering a major sell signal on the 5th of December, went significantly lower but the last few days we had a bullish correction here which aimed the previously broken support. Why correction and not a reversal? Well, the upswing is shaped like a wedge so it promotes the further drop. Yesterday and today, the price tested the 38,2% Fibonacci. Those tests resulted in a bearish bounce so we may be witnessing the end of the correction and a comeback to the main trend (down).
Another one is the EURJPY, which finally escaped from the sideways trend present here since September. The price broke the major resistance yesterday and today’s candle is making higher highs and lows which is positive and adds a confirmation for the bullish movement.
The last instrument is the AUDUSD, where we do have a pennant formation after a major upswing. Pennant is a trend continuation pattern so it should result in an upswing but for a proper trading signal, we have to wait for the breakout.
This article is written by Tomasz Wisniewski, a senior analyst at Alpari Research & Analysis