U.S. Dollar IndexShort
DXY XABCD Pattern and "M" Pattern Trade plan
In case you were wondering why the USD took a downturn today after this news I can somewhat shed some light into what had happened.
There were two components in play for the USD.
The first one is the obvious miss on the unemployment rate.
The other is the better than expected NFP numbers.
In order to complete the pattern that has been identified on the DXY price had to reach the 1.333 FIB level in order to turn around and fall. Price was almost there and therefore it completed its turn at the nearest FIB level during a fundamental news release. That pushed the DXY a bit higher and then the drop began.
If the news was good why did the DXY drop? Ah ha.....well many times the market "Bakes-IN" these expected numbers and if you see a DXY chart the USD has been rising all week.....it was just time for a correction....which is what we are in at the moment.
There were two components in play for the USD.
The first one is the obvious miss on the unemployment rate.
The other is the better than expected NFP numbers.
In order to complete the pattern that has been identified on the DXY price had to reach the 1.333 FIB level in order to turn around and fall. Price was almost there and therefore it completed its turn at the nearest FIB level during a fundamental news release. That pushed the DXY a bit higher and then the drop began.
If the news was good why did the DXY drop? Ah ha.....well many times the market "Bakes-IN" these expected numbers and if you see a DXY chart the USD has been rising all week.....it was just time for a correction....which is what we are in at the moment.
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