“INDICATOR OF THE DAY” - PSYCHOLOGICAL BARRIERS
On Monday, we talked about the importance of daily highs and lows and their extreme importance as technical indicators despite their simplicity. Today, we will explore psychological barriers, another basic indicator which also more often than not can prove to be quite insightful.
Aud/Kiwi has been tracking higher over the past several days breaking to fresh 2009 highs and now threatening to clear the 2008 multi year highs by 1.2970(24Jul high) over the coming session. However, with the daily studies looking quite stretched as evidenced by the overbought stochastics and RSI, scope exists for a short-term pullback over the coming days. While we expect 1.2970 to indeed be cleared, the critical 1.3000 psychological barriers are just above. Traders of all kinds will often look to book profits on positions by big figures, and the logic is even more applicable with tests of major psychological barriers. As such, we recommend looking to sell on rallies to 1.3000 in anticipation of a much needed healthy short-term corrective pullback.
Written by Joel Kruger, Technical Currency Analyst for DailyFX.com
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</p> Joel Kruger publishes 6 daily pieces:
“Tech Talk” – A Daily Video Highlighting Technical Developments in the Overnight Session of Trade.
Monday-Friday (between 5:30am-6:30am EST)
“Morning Slices” – Morning Overview using Fundamental, Technical, Flow, and Quantitative Analysis (Includes “Trade of the Day”).
Monday-Friday (between 6:30am-7:30am EST)
“Indicator of the Day” – A Feature Report that Highlights our Most Significant Technical Indicator of the Day.
Monday-Friday (between 8:00am-9:00am EST)
“Cross Country” – A Midday Fundamental Update, along with Technical Analysis of Selected Cross Rates.
Monday-Friday (between 10:30am-11:30am EST)
“Scandi Daily” – A Specialized Daily Fundamental and Technical Overview of the Nordic Currencies. (This report is only distributed through email. Please contact [email protected] if you would like to be added to distribution.)
Monday-Friday (between 11:30am-12:30pm EST)
“Daily Classical” – A Daily Technical Overview of the Major Currencies.
Monday-Friday (published between 2:00pm-3:00pm EST)