The coming year will see a raft of global central banks reversing their loose, pandemic monetary settings of the last two-years decisions and begin to normalize monetary policy by withdrawing emergency stimulus measures and hiking interest rates. Major central banks, including the Federal Reserve, the Bank of England, the Reserve Bank of Australia, and the Bank of Canada, have already given markets a strong heads-up about what is to come over the next few months. One central bank however that will not be raising interest rates is the Bank of Japan, even though their short-term policy rate sits 10 basis points in ... (full story)
Yes, the Week chart does show PA has arrived again to a VERY significant and pivotal area. However, before buying into bias cleverly caged in "news", we might be taken aback by something that happened on this last move up.
On the Day chart below we can see during this last move up of about two weeks duration, suddenly there was high activity in the 89.200 area even though activity was dropping on the way up to this price area. Was this SM buying, or SM selling? Well, price continued to climb after those orders were filled, and again we see price rose on weak activity. Now, if SM sold down there, they made a HUGE mistake. This is not likely. It is more likely SM bought down there and gave the MMs orders to "Sell high!" someplace higher up. If this is what happened, we know the MMs will, at some point, do exactly that.......HTMRW.
Hope you are getting the picture now. In order for MMs to fill SM "sell to close longs" orders they will need liquidity. It only comes from buyers! And, sadly, the traditional providers of liquidity, so that MMs can open or close SM orders, comes from the market sheep that "news with planted bias" helps to herd off the cliff......HTMRW.
We cannot ever know how the MMs will move price next, but there is reason enough here to be very cautious.....