HAS THE TREND CHANGE... YET?

The majority always re-act rather than act. The fall of Euro and Sterling for the last 2 weeks seems giving an alarm to those who are staying long with their position as taking the top into consideration, it's been over 800 pips declined for the Euro as well as Sterling since their previous top in December.

The question is... what do we do now? Should we go short all the way till New Year, stay aside or just defy the market's movement.

Clearly the third option is not a wise decision.

Now, looking at the gold price as well, it seems like investors are starting to cash-out their dollar investment in this precious metal. The Bloomberg as well as CNBC were talking about the gold support price at 1008.00 but the way I see it the gold could go down to 1000.00 before making a serious rebound or trend to a new high beyond the 1226 level.

At the same time, year 2010 is approaching fast in the next 2 weeks and some speculators are still talking about the fall of Dollars to continue in 2010. Is this a true claim or is it just a blind opinion base on what they believe?

What about us as retail traders? It is up to you actually. If you asked me... of course for now I will remain bearish with the Euro and GBP but of course, will be caution along the way especially with the Fibonacci levels on this new downtrend for these 2 pairs.

So, what's the verdict for next week?

Though I clearly mentioned that I will remain bearish on these 2 pairs, it doesn't mean that I will blindly shorting them without any safety precaution. As of the daily candlestick is showing a doji formation on the last day of trading for this week (on both pairs), it could be an early sign that the bear is running out of steam.

Hence, for next week, though bears are clearly in control, the bulls are likely to make a brief come back and push the price a little bit higher to the 1.4600 level for Euro and 1.6350 for the Sterling. Those 2 levels are the 38.2% retracements for the price falls between 1.5144 - 1.4262 (Euro) and 1.6879 - 1.6050 (GBP).

Contrarily, if these 2 pairs ever continue its downward journey straight away on Monday, Euro could probably try to break the 1.4122 levels and the Sterling will probably move South towards its next support at 1.5706.

On the long run, as long as the Euro do not breach the 1.3500 level and the Sterling stays above 1.4900, chances are they are still on the bull run. But if any of these levels are broken, then prepare for a long term downtrend for these pairs as well as long term uptrend for the dollars.

Yeah sure I could be wrong. But you must remember that in this "anything can happen" market, the market will do whatever it believes. And the reality is :- there is no such thing as top or bottom because if you look closely, the market can either be topless or bottomless... as far as there are buyers or sellers who are willing to push the price further...

In summary, my advice is always :- just be careful with your trade... The tribe has spoken and the price itself is the real indicator above other indicators that you could be using... Hence, always stick to the market's decision as they are always right no matter what...