// For my own personal learning & experimental + retracing previous ideas...Trying oput P&L setting and Trade taking
EuRUSD seems to be in state of confusion.. FED is printing money that should weaken the USD but not really showing here (immediately)..,
We have seen the USD strengthening ever since June2008.. EUR was strongest on Nov 2009, Mar 2011, May 2014, Feb 2018 and now
We have now kind of broken that USD bull and making retestng... Starting of Jul 2020 ..
This, with the fact that we are touching 200 EMA on dailies, suggests to me that we are making a higher low on our way up on EURUSD.. ie. USD weakening..
So now we should keep the EURUSD above 1.164 to maintain the brakeout and be LONG on EURUSD.
The new 3 Trillion USD Stimulus would also most likely weaken the USD against EUR, so in that sense also LONG on EURUSD.
AND... This all would be totally in line also with a yearly DXY forecast looking from 1986. .. On yearlies, we were on our way to DXY channel lows touching area where EURUSD would have been under 1.00 but this was messed up by Covid-19.. I think there's a still chance for that while we would still be in yearly trend.
What we might be missing and the argument dragging down EURUSD (supporting DXY) is the constant rise in the US 10Y. Inflation fear is rising in the market and that's what the bond market is saying: "THE FED and POWELL, YOU ARE WRONG". In other words, if you continue printing money at this rate, it will be to late to stop inflation from rising. And if inflation fears become real the rates in the US will shoot up (like skyrocket to levels not seen in 20 years...! And that will be the strongest support for the USD as the spread between German and US 10Y will keep on increasing and everyone will want to buy USD to benefit from much higher yields....
What I suspect we would want to see is the FED being right and the US 10Y to pause at this level (1.6-1.7%). Money to continue pouring in, but the damage from covid being lasting into 2023, hence no inflation until then, but the strongest devaluation of the USD since 2008...
DeGRAM
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My algorithm suggests that you should not rush to EURUSD at 1.18123 in buy, it is better to wait a little)
Heathcliff_
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@DeGRAM, Care to share it with me... Would like to take a look.
Slippery09
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It seems you are aiming to improve your trading skills, f I could offer one piece of advice, ditch the indicators.
They do have their place, but this is useful if it backs up (or goes against) your ideas based on price action and market structure.
Fibs are important, other than that, it's just noise that will prevent you from making a decision
Heathcliff_
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@Slippery09, Thanks.. That's exactly what I'm trying to do and all comments and suggestions are welcomed.
Slippery09
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@mattiheju, You are welcome, glad you took it as constructive advice, it can be tricky to not come across as a smart arse when you just want to help!
Why not join in my Telegram group, no fees, no bullshit, just a few helpful guys learning and teaching each other!
What we might be missing and the argument dragging down EURUSD (supporting DXY) is the constant rise in the US 10Y. Inflation fear is rising in the market and that's what the bond market is saying: "THE FED and POWELL, YOU ARE WRONG". In other words, if you continue printing money at this rate, it will be to late to stop inflation from rising. And if inflation fears become real the rates in the US will shoot up (like skyrocket to levels not seen in 20 years...! And that will be the strongest support for the USD as the spread between German and US 10Y will keep on increasing and everyone will want to buy USD to benefit from much higher yields....
What I suspect we would want to see is the FED being right and the US 10Y to pause at this level (1.6-1.7%). Money to continue pouring in, but the damage from covid being lasting into 2023, hence no inflation until then, but the strongest devaluation of the USD since 2008...