THE DOLLAR HAS YET TO SHOW REVERSAL...

Today is 30th November 2009, the last day of the month and as of this writing, the dollar has yet showing a clear sign of reversals.

Let's look at EUR/USD fundamental & technical analysis for example...

1. Though this pair made a yearly high last week at 1.5145 on Wednesday, market were hit by the Dubai news last Thursday and instantly react to safety, in which the pair were rallying down to 1.4829 before closing at 1.4966, 140 pips above the daily/weekly low.

2. This tail between 1.4829 to 1.4966 shows that bulls are still indeed in control, meaning that despite of reports saying that traders start taking flight to safety, the price actions indicate that risk appetite among market players are still there.

3. As of this writing, the bulls are still in control with daily high so far at 1.5065.

4. The question is, will this rally continue or is this just a trap to bring in suckers before market could make a significant reversal in December?

5. Some traders may perceive me as hoping for the dollar to reverse, though the fact is not.

6. What I am trying to share here is since this pair has been climbing up since last March with one little Doji in June (refer to monthly candlestick), I have no confidence in going long for this pair, at least in December.

7. The trend is indeed clear, but what I see is a technical correction is coming.

8. It probably not a reversal, but at least a correction to the 1.4500 (23.6%), 1.4100 (38.2%) and 1.3800 (50%) fibonacci levels.

9. My simple rule of thumb always says - Anything that goes up will eventually come down, anything that goes down will eventually come up... or so called the Ying & Yang in trading... the cycle will continue.

10. The only thing that we need to be careful with is not to over-speculate in a way we tend to stand in front of a running train (sell when market rally up) or catching a falling knife (buy when market is rallying down)...

11. No matter what you believe, the market is always right and we have no right to argue. Period.

As usual, my disclaimer is always -> I could be wrong, but at least this is my stance for the moment.

I am waiting for the opportunity to go short on EUR/USD, but 50/50 on GBP/USD. Best thing to do is to sit and watch how the market behave today before deciding on what to do for the rest of the week.

By the way, do not forget that this week we have NFP on Friday... chances are swinger will likely to off-load their positions prior to this BIG NEWS... hence creating good opportunities for us small traders to take advantage on this volatility.

Have a blessing week & safe trade...

;)