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day trading strategy begins each morning with a detailed review of the dollar index
review of the dollar index. We use
multiple timeframes to locate the most important levels of support and
resistance and we start with our 89 range chart where we can see a few big
clues that give us some direction today on the dollar index. We recall the dollar index correlation when
reviewing the dollar index.
77.840 and the green box illustrates where we are going to have support so we
know the dollar index is going to have a tough job moving lower. We can also see the AB=CD pattern which projects
price lower at 76.635 so we can use the if price moves lower. Lastly, we can see trend lines above and
below which confirms a price wedge, which is one of the biggest clues we
get. I will expect lots of support at
the lows of a price wedge and resistance at the highs. This 89 range chart shows me where the most important
support and resistance levels are today, but I need a faster timeframe to give
me the short term trend.
We move to a faster 13-range chart and we can
begin to see the short term trend, or in this case the lack of trend this
morning with higher highs and lower lows with a slightly flat trigger line we
cant say there is a strong trend, which is ok, it tells us we need to be open
to both directions for our trades today. The most important thing we get on the
dollar index chart is the support and resistance levels above and below
us. If the dollar index moves higher we
see trend lines and trigger-zones overhead for resistance, and if price drops
we can seen trend line, swing lows, and the AB=CD support below as well. These support
and resistance levels will be great trading opportunities for us today so we
are looking for the dollar index to be trading around these support and
resistance levels when we trade other markets.
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| Dollar Index Day Trading Strategy |
