I had a great week in London last week. I always enjoy connecting with other traders, clients and some of the institutions that I support. It was also a lively week in the markets – which is a double edged sword.
Anyway back to charts and the markets and I want to draw your attention to the USD. Time for a quick heads-up Take a look at the US Dollar Index Chart below.
I had posted a few weeks back on the Veterans Trader Project FB page about looking at a possible Head & Shoulders pattern building on the Daily Chart of the Dollar Index. Hopefully you can see how I annotated the chart above to show the possible Right Shoulder forming.
As usual the plan didn’t work out as sweetly as I had thought and price grinded higher the last few weeks. Until the FOMC event of last week caused a cavalcade of USD selling across the board. Now we have what looks like a very scruffy Right Shoulder…..but it is one nonetheless. Furthermore we have seen Dollar Strength wane considerably this week across the STAM.
So far today we have bounced off the psych number of 100. I believe a close and hold beneath that on a weekly basis will be bearish for the USD and I’ll be building a position accordingly.
Take a look and keep your powder dry! Trade well,