Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Consolidation On Currency Trade

News wires are busy in regard to ‘strong-dollar’ US Administration jawboning, and the inability to back the talk with action. TheLFB client notes have called for consolidation at support above 72.50 on the dollar index (DXY), and to monitor resistance at 76.50 very closely. Tradable calls to action were sent to clients last week with trade signals to sell DXY, which have now completed their course and should be closed. Six days of sideways consolidation allowed only one break-out signal to form, and heavy consolidation is being seen in currency markets.

Outlook:
No signals are forming in the near-term, after last week’s burst of dollar buying continues to be absorbed. Clients will be notified when price action breaks and holds, via TheLFB’s Market Alert service which sends a notice to clients that highlights potential sustainable global market movement, sentiment change, or breaking news releases.

Sentiment towards the Usd remains mixed. Price action favors a reversal of recent moves higher.  Caution is required by those looking to buy the US dollar or DXY exchange traded fund, as. TheLFB trade desk is not expecting a sustainable break-out higher in DXY values above 76.50.

Price Action:
There was strong buying activity previously at 74.50, which is a potential price reversal area of note that the dollar index could work back towards. This swing point area, where a near-term trend forms and price action reverses previous trade direction will be closely monitored and trade signals or market alerts sent to subscribers as things unfold.

The daily trading range on DXY is 60 ticks, which is above the historical norm and confirms interest in moving prices. The 50-day Simple Moving Average (NYSE:SMA) on the dollar index is @ 75.65. DXY price action has a 36-month 75% correlation to crude oil and SPY moves, and an 80% correlation to the euro currency pair (Eur/Usd).

Trade Plan:

The detail below will help guide traders with analysis on intra-day price movement, trend, and momentum. Content provided by TheLFB Trade Plans.


dxy tp


For full trade plan analysis, upgrade to the Tier 2 subscriptions. Receive daily client notes, market alerts, trade signals, trade plans, and videos today!