TomProTrader
Long

Dollar - Bottom Is In

TVC:DXY   U.S. Dollar Currency Index
Today we have an excellent opportunity for Dollar on the 8H chart with a trend bottom. I really like the look of this set up!

Price hit the 1.414 Fibonacci extension leg, hit horizontal support, and hit the channel support level simultaneously. There is so much structure support at current level that it is definitely a good idea to look for a buying opportunity.

At this current moment in time, price is correcting to the upside. I have highlighted 2 targets on the chart which could be favorable if the trade works out.

I believe this trade could play out in several different ways. I have outlined these below.

  • Price will carry on with the upside move without stalling, to hit the 1st target of 93.62.
  • Price will stall and retest the support level , before going to the upside again. (This trading scenario would be less risky than the first.)
  • Price will travel to the upside, have a small correction, and then go to the highs. (This scenario would be the best. As we can: Add to position on the small wave correction before reaching target. 2: We can take profits on the correction, and then buy in again, removing most risk.)

Bare in mind that price could exceed target and go to target 2 (The extended target illustrated on the chart) at 94.96. We will look at this as a target if price exceeds target 1. (See chart for details.)

Use this analysis to guide you with this trade, but also factor in your own.

Sometimes less is more. Let's listen to the basic message of the structure, and allow it to tell us what to do.

I will be updating this analysis as the trade plays out. So like & follow so that you do not miss out of my latest analysis and updates.
Comment: Dollar appears to be having a temporary correction. This is good as a pullback (Or a retest to previous support zone would be even better) will confirm that we are not buying into a rally.

Buying into a already moving price is always more inherently risky. We should never buy into an overextended up or down move without correction.

Comment: I am currently waiting for the right opportunity to go long.

Since Dollar hit structure bottom, there is no where for it to go but up. We just need to be patient and wait for the chart to tell us when to enter the trade.

When analyzing the 1H chart, it is clear price is in a correction that is not going to reverse, yet. Price is correcting, before the up move.

Comment: Dollar is trading up a sideways support level.

If price breaks the sideways support, this could signal further downside correction. If price trades up, breaking the above horizontal resistance (See chart for details) then it will signal an up move continuation move.

There's nothing we can do but wait. In a trade like this it is important to be patient. We have one significant thing to our advantage in trades like this, and a that is time.

Trade closed: target reached: First target was reached earlier. I am now expecting a correction before the possibility of breaking structure and hitting target #2. (See below chart.)

Thank you Tom! Same view here.
+1 Reply
TomProTrader Victor.Y.F
@Victor.Y.F, Great. I am strongly expecting the up move very soon.
Reply
Victor.Y.F TomProTrader
+1 Reply
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