Just as a check, we like to look at the dollar from multiple angles to see if we have the trend correct. Today we will be looking at the EURUSD pair, as it is the largest weighting in the DXY index. So let’s have a look:
So what we are seeing here is a bullish trend overall on the 3 day chart. Isn’t it crazy how close the EURUSD pair came to the 161% extension? Typically you are taking risk off anyways at this level, especially if you have a failure at the resistance level. We also have a MACD cross and a RSI bearish divergence. All points showing a counter trend move to the downside. The first target, which would be more of a sideways and ranging trend is the 23.6% retracement. This would give some of the bearish indicators time to resolve themselves before moving higher. Or we have a meaningful pullback to 38.2% retracement, which matches up with the 100% extension! If the RSI makes a higher low at 55, it is even more bullish. If we break through that, this could end up being a trend change with further bearish downside for the EUR. Keep your head on a swivel!
Happy Trading!
So what we are seeing here is a bullish trend overall on the 3 day chart. Isn’t it crazy how close the EURUSD pair came to the 161% extension? Typically you are taking risk off anyways at this level, especially if you have a failure at the resistance level. We also have a MACD cross and a RSI bearish divergence. All points showing a counter trend move to the downside. The first target, which would be more of a sideways and ranging trend is the 23.6% retracement. This would give some of the bearish indicators time to resolve themselves before moving higher. Or we have a meaningful pullback to 38.2% retracement, which matches up with the 100% extension! If the RSI makes a higher low at 55, it is even more bullish. If we break through that, this could end up being a trend change with further bearish downside for the EUR. Keep your head on a swivel!
Happy Trading!