At the Open. Expected correction.

09:05CET

Good morning everyone, hope you are fine. Well, at last we've had it, I mean the USD correction. The leader on this round keeps being the USD/CHF, who alerted us of the USD overbought status and who triggered the first short signals yesterday. The correction, although only modest, serves to create a better picture for any future USD advance to come, for many longs have squared, therefore if they were to re-start their positions, they would do so from a fresh start.

Interesting to note today that Gold is testing the broken support line, now resistance line @ 1,357, I feel that taking shorts here with a stop above 1,365 is a good trading idea, still aiming at that neckline of the bigger formation @ 1,315 to be tested. Honestly, I do not know whether this correction will last or not, but when it comes to gold it has been more than reasonable in terms of price.

As for the other majors, only interest thus far in EUR/USD, who has corrected mildly to 1.36, and where sell orders are reported around 1.3620-25, and I have to say that taking a short there looks good to me. Cable is stubbornly low this morning, only a EUR and CHF affair it seems.

To conclude this opening post, let me give you how retail traders are positioning themselves at this hour. Long/Short ratio provided below.

Nov 18, 2010 09:00 GMT+0100

   1. XAU/USD
      76.11% 23.89%
   2. USD/JPY
      75.94% 24.06%
   3. USD/CHF
      68.78% 31.22%
   4. USD/CAD
      60.55% 39.45%
   5. AUD/USD
      51.86% 48.14%
   6. EUR/USD
      47.62% 52.38%
   7. GBP/USD
      46.26% 53.74%

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