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Euro uses Dollar-index-correlation to make easy day trading profits
This morning
we used one of our favorite day trading
strategies to earn some easy profit on the euro in our Live Trade Room. We used the dollar-index-correlation
strategy this morning to look for high-percentage-trades on the Euro,
and in today’s video I want to teach you how to use the dollar-index-correlation
along with any market you wish to trade.
The first thing you need to know is that
all markets have a fundamental negative correlation with the dollar-index.
The reason for this is quite simple; as the dollar-index falls in value,
our ‘dollars’ become less valuable, and therefor things become more expensive
in-comparison to the dollars. When
things become more expensive they also become ‘scarce’ and that creates a
higher demand, which leads to higher prices.
The opposite is true if the dollar-index moves higher and our dollars
are worth more.
buy more ‘stuff’, that ‘stuff is in larger supply, and therefor prices will
drop. This is the root of the dollar-index-correlation.
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| Euro Chart says BUY |
The Euro was
our first clue this morning, trading at the lows of a bull price
channel and the lows of the overnight trading session. We found many reasons this morning to buy the
Euro; bull price channel, at the lows of the range, and a Fibonacci
buy-zone from yesterday.
BUY this morning, and we recognized this 2 hours ahead of time with our morning
prep
 |
| Dollar Index Collapses |
Once we
found the Euro was ready to move higher, we compared our notes with the dollar-index
to make sure we accounted for the dollar-index-correlation. We quickly found the dollar-index had been
rising this morning early in the session, and we planned to stay patient to
wait for the dollar-index to start to FALL LOWER so the euro would RISE
HIGHER.
moments before the dollar-index tumbled outside of the price channel and gave
us a BIG confidence boost for buying the Euro.
