Day trading strategy for dollar index futures

The dollar index trading inside
the range from Monday, and clearly lacking any long term direction right now as
the volatility index has been very low and we can easily see sloppy price
action on the faster timeframes.  The 55-range
chart shows us moving higher this morning just below the PHOD so we know we
have major resistance overhead with the trend line and the price wedge highs
along with the PHOD as initial resistance.

As price rises we expect that the
buyers will hit resistance and this will cause the dollar index to stall at the
highs. If the dollar index tests resistance we have three possible
scenarios;  price can go higher, lower,
or sideways.  If the dollar index pushes
higher through the resistance we know this market is VERY strong and therefore
we will assume price will keep rising and we will sell retracements with new lower-lows
on the markets we trade.  If the dollar
index goes sideways, we also need to expect a sideways and range-bound market
across the others we trade, and If the dollar index reverses and moves lower,
we know now to buy pullbacks on the markets we trade.  Very often, we can ANTICIPATE how the dollar
index will move, and that will give us clues to where our future trades will
be.