June 1, 2012
- in Uncategorized by schooloftrade
Day trading strategy dollar index
Dollar index trading atthe highs of the major bull channel. We can
also see a short term bull price channel along with the recent bearish AB=CD Pattern and the double-bottom resistance overhead.
This dollar index has been on a bullish run for the last few weeks, and
as of today we are at the highs of this range with 4 different levels of resistance
standing in the way of higher-highs. Will
the dollar index fail at these highs and move lower? Will the dollar index chop around sideways
and stick at these highs? Will this resistance
be broken by strong buyers and give us new higher-highs? We have three different scenarios and we need
to be prepared for this today.
Think about what we are
going to do if the dollar index moves higher, lower, or sideways.
Anticipate if the dollar index rises to new higher-highs we will sell retracements
with a wave-pattern short. If the dollar
index trades sideways at these highs, we then will see similar price action on
the markets we trade, and we will trade sideways ranges with a sideways dollar
index. If the dollar index falls off
these highs it will give us buying opportunities on the markets we trade, using
the wave pattern to buy pullbacks with new higher-highs on markets such as Crude
Oil, E-Mini-Russell, euro and gold futures.
going to do if the dollar index moves higher, lower, or sideways.
Anticipate if the dollar index rises to new higher-highs we will sell retracements
with a wave-pattern short. If the dollar
index trades sideways at these highs, we then will see similar price action on
the markets we trade, and we will trade sideways ranges with a sideways dollar
index. If the dollar index falls off
these highs it will give us buying opportunities on the markets we trade, using
the wave pattern to buy pullbacks with new higher-highs on markets such as Crude
Oil, E-Mini-Russell, euro and gold futures.
The 21-range chartshows us most amount of details and we can see the bullish price channel inside
of the longer term price channel along with the AB=CD Pattern resistance so we can use this to plan
our attack. The bull price channel says
the high-percentage trades come when we buy at the lows. So if the dollar index is at the price
channel lows, it will be expected to RISE off this support, and this would
result in falling prices on the markets we trade, so we would be selling retracements
with the dollar index at price channel lows.
So we know RIGHT NOW where our high-percentage trades will occur today,
now we just need to wait for it.
On the
flip side of that coin if the dollar index moves higher and tests the price channel highs we know NOT
to buy at these highs, so this is considered resistance and that means that if
the dollar index is at the highs we will have a hard time with the short-side
selling retracements on the way down.
