USD, in the monthly chart, is currently in a range. Although the long term trend is upward. The Horizontal Resistance at 10841 level is really a significant area. It is very interesting that the current price is at/near this level. We could see in the next few weeks how the market will react at this level. But even if we see the reaction of the market, we don't want to trade yet. If this current monthly bar closed and formed a Bearish pin bar
(a large one), we could consider going Short. But if the bar closed above the resistance level
, we might want to consider the next months' bars before placing a trade. A retracement would be best to look for if this close above the resistance happened. Another scenario is that, if this current bar closed at the resistance (and did not form a Bearish pin bar
), selling immediately might not be a good idea. We need to wait for the next candle to form and close. And if it give as a bearish
signal, that would be the time we could put a Short trade. Though, we need to consider the Uptrend Support before doing this. These are different scenarios that I'm looking for to happen here.
The Bullish Engulfing
Bar (BUEB) is a perfect formation. It formed above the Horizontal Support line which indicates that the market want to go up and it did. It also formed near the Uptrend Support. In other words, this Price Action formed in a confluence zone. Although USD is currently in a range, this BUEB might be an indication that the market wants to continue up and could break the resistance level
Many things can happen and for now, we need to wait and see what the market does.