Hey Traders,
The dollar index has been moving to the upside making some form of a wedge or a contracting diagonal. According to the basic technical analysis and based on Elliot waves theories, we should expect a reversal once the diagonal is completed. In addition to that, we can observe divergence by looking at the MACD. This indicator is used to predict when the reversal will happen.
How can we benefit from the dollar index?
The formula says: If the dollar index or DXY is bearish then we should expect the opposite for XXXUSD pairs. For example, If DXY is Bearish then we should look for EURUSD LONG.
By looking at the price action and by counting the recent waves, we expect one more move up before the move down.
What is our confirmation for the DXY bearish scenario?
We can use the break of 50 EMA on 4H timeframe as a confirmation for XXXUSD LONG and USDXXX SHORT.
If you like this type of analysis, don't forget to hit the LIKE bottom. If we hit 50 likes, am gonna show you how we can look for a trade using this idea.
Have a Good trading week!
The dollar index has been moving to the upside making some form of a wedge or a contracting diagonal. According to the basic technical analysis and based on Elliot waves theories, we should expect a reversal once the diagonal is completed. In addition to that, we can observe divergence by looking at the MACD. This indicator is used to predict when the reversal will happen.
How can we benefit from the dollar index?
The formula says: If the dollar index or DXY is bearish then we should expect the opposite for XXXUSD pairs. For example, If DXY is Bearish then we should look for EURUSD LONG.
By looking at the price action and by counting the recent waves, we expect one more move up before the move down.
What is our confirmation for the DXY bearish scenario?
We can use the break of 50 EMA on 4H timeframe as a confirmation for XXXUSD LONG and USDXXX SHORT.
If you like this type of analysis, don't forget to hit the LIKE bottom. If we hit 50 likes, am gonna show you how we can look for a trade using this idea.
Have a Good trading week!