New COVID Strain Spurs Risk-Off
Gregor Horvat | Dec 21, 2020 03:14AM ET
Markets are in risk-off mode after new covid strain boosts the dollar. At the same time we see only gold moving higher meaning traders are concerned about the current covid situation. Plus, there are end of the year flows and position adjustments which is also very important driver for reversal as we approach the holidays.
On German DAX we can see that price is turning down from a new high after it touched the upper line of an EW channel. We see a sharp intraday weakness right now which makes us think that top can be put in place for wave five and that lower prices may follow. Divergence on the RSI may also indicate a potential top so be aware of an A-B-C retracement, ideally back to 12300-12500 support early in January.
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