DXY / DX1! / USDOLLAR / Dollar Index is searching for liquidity, bouncing up and down in the process. This is my long term prediction on how it could move - given no major economic shifts.
Option 1
- DXY breaks below the Q1 2018 lows, collects liquidity
- It then runs up to fill in the fair value gap from Q3 2020
- It then falls down and get rejected from Q3 2014 lows as those trapped shorts exit - creating a rally
- It then falls down again below Q3 2014 lows to collect liquidity
- Heads back up again in search of liquidity
Option 2
- DXY creates a short term low just before Q1 2018 liquidity run, so that it can trap even more traders
- It then runs up to fill in the fair value gap from Q3 2020
- It then falls down, collects the liquidity below Q1 2018 lows
- Get rejected from Q3 2014 lows as those trapped shorts exit - creating a rally
- It then falls down again below Q3 2014 lows to collect liquidity
- Heads back up again in search of liquidity
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.