Long term trend: Up Medium term trend: Up Significant Levels: Horizontal Resistance (11010), Horizontal Support (10880)
US Dollar strength is so strong that it cannot maintain its momentum. As what I'm always saying, a strong move cannot be maintained for an extended period of time. Though USD is moving down, we are still Bullish here. Retracements are normal. Traders/investors are just taking their profits. That's why the USD is going down for now. This is also supported by the weak data from US. Again, although this is the case, we are still Bullish here. This index might still go down to the support level or the 0.618 Fibonacci level.
Use this information to trade currency pairs that has USD in it. This index is highly correlated to EUR/USD pair because USD Index is composed mostly of EUR, so you might want to start with that.
Trade well.
Comments
aleipena
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I got it. Thanks for the quick reply.
Investor.Unity
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No worries.
aleipena
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Hello,
I am sorry for asking this, but why the Fibonacci extension is taken from top to bottom if the chart is on uptrend?
Thanks for sharing your knowledge.
Investor.Unity
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That's a good question actually. Many are confused with this. With regards to drawing Fibonacci Retracement, it is true that many are teaching to draw it the other way around (as to opposite of what I've done). But for you to try out, you can draw it the other way and the way I drew it. The lines will just be the same. The 0.382 level would be the 0.618 level and vice versa. It will just depend on your interpretation, but both are basically the same. The lines are the important ones and not the numbers. Though, these two levels that I mentioned (and the 50% retracement), are what I think are the important lines. And these would just be the same either way. Try it out. I hope that that answered your question. Thanks.
Investor.Unity
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And by the way, this is a Fibonacci Retracement and not Fib Extension