March 23, 2012
- in Uncategorized by schooloftrade
The dollar index day trading strategy
We’re looking for the short-term-trend and the major levels
of support and resistance on the dollar index because when we see a trend we
can trade AGAINST the trend with the negative correlation, and the major support
and resistance will be excellent trading location and opportunities when price
either reverses off these levels or successfully breaks those support and
resistance levels.
89 range chart shows me a big RED FLAG, we are not at the
highs or the lows, we are dead middle of the range. We want to be at major turning points on the dollar
index, and this is not it.
highs or the lows, we are dead middle of the range. We want to be at major turning points on the dollar
index, and this is not it.
The 21 range chart on the dollar index shows us support
below and resistance above us as price moves above and below the PHOD. Remember how we treat the inside day and
outside days on the dollar index.
below and resistance above us as price moves above and below the PHOD. Remember how we treat the inside day and
outside days on the dollar index.
We quickly see an AB=CD pattern on this 21 range chart which
tells us two thing. First, if price
moves lower we know where it wants to go, and we will expect price to rise off
the AB=CD Reversal Zone. Second, if
price moves above the trigger-zone we then know price is VERY strong, and we
can use that as a big clue.
tells us two thing. First, if price
moves lower we know where it wants to go, and we will expect price to rise off
the AB=CD Reversal Zone. Second, if
price moves above the trigger-zone we then know price is VERY strong, and we
can use that as a big clue.
From the look of this chart the dollar index should
drop lower, so we should be buying. Remember
though, if the dollar index does NOT go lower this is a BIG CLUE we need to be
ready for and use this as a trading opportunity.
