US/China news sends the pair back higher.
The evergreen US/China story continues. Today, is more good news as it seems that China will not demand that tariffs be rolled back for a Phase I agreement.
Technically, that news rewarded the traders who stuck a toe in the water earlier in the session against the combo 100 and 200 hour MAs (blue and green lines). The 200 hour MA was breached on a quick move below, but the nearby 100 hour MA was not (blue line). The headlines sent the pair higher.
We are currently trading near session highs, and in the process, are back above the 200 day MA at 109.009. With the last 5-6 hours above, that MA is back to being a close risk level for longs looking for more.
Admittedly, the pair has had it's chances above that MA level. Back on October 29, there was a small break that stalled ahead of a trend line. On October 30 (FOMC day), Ther was a bigger break but it too ran into the trend line and backed off.
This week, on Tuesday and again on Wednesday, there were runs higher that got close to the October 30 high but backed off.
We are currently trading at new highs for the day and are testing the Tuesday high. Can it push and break above the recent highs?
Looking at the daily chart below, the 109.352 is the 61.8% of the move down from the April high. That is also near the high from August 1. A break above opens the door for more upside mometnum.
US stock futures are implying a higher opening. The US yields are also higher with 10 year up 5.8 basis points now. Gold is lower by -$6.