- April 7, 2021
- Posted by: Tradingshot Articles
- Category: Forex
The U.S. Dollar Index is on critical cross cross-roads. Last week it got rejected on the Higher Highs trend-line (4H time-frame, left chart) and naturally pulled back to the Higher Lows trend-line, which is so far holding. With the 4H RSI oversold, the short-term sentiment is bullish.
However last week’s rejection didn’t only happen on the Higher Highs trend-line but also right below the 1W MA50 (yellow trend-line). Technically that’s what makes all the difference when it comes to long-term trends. Theoretically as long as it holds, the long-term trend remains bearish on DXY. On the 1D time-frame (right chart), the MACD just formed a Bearish Cross while the RSI Double Topped, so if the Higher Lows trend-line breaks, expect the Support 1 to be tested and potentially the Support 2. That will largely depend on what the 1D MA100 (green trend-line on the right chart) will do, as it has been an important pivot since March 2020, supporting the price twice (green arrows), while rejecting it another two times (red arrows). It’s role becomes even stronger as it has been supporting since last month’s break-out.
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