The 1st week of May is full of major scheduled events including Fed Rate, French Election over the weekend and geopolitical tension. Factors that could provide additional and which could easily change the analysis described.
However, since Jan 2017 low, we can note the following:
1. Price has formed a potential of 3-3-3-3-3 structure (impulsive move of the low) which is likely complete. Last week price gaped up on open and then stalled. It could for a platform to accelerate the move up but this is less likely.
2. It has run in to structural resistance, which was previously a horizontal support.
3. Daily at potential over bought level.
4. pitchfork’s sliding parallel (Brown) in proximity.
5. Report suggests that the Small speculators have just gone net long and are likely to be chopped.
6. Seasonally, May is very for USD which has completed a corresponding (see chart below).
If the above holds true then we could retrace in a towards $1.06 – $1.05 zones before a new cycle could develop.
a) Any longs should be either exited or have tight stops.
b) Short position could be initiated with very clearly defined risk ie just above the high of the last week.
Warning: This is my interpretation of price action using TA approach that I consider which helps me the most but could be completely wrong. Therefore, as always, do your own analysis for your trade requirement and ignore my views.
For those who appreciate my analysis, select to follow me and the chart for notification of future updates. Indicate you like my analysis by thumbs up, comments and sharing it with others. If you have an alternative idea, then please be constructive and share for all to learn from.
Thank you for taking the time to read my analysis.
DXY with bearish leading diagonal