Recommendation: LOOK TO GO LONG
Current Trend: Short- and med-term down, but oversold. Long-term sideways.
Strategy: Go long a close above line 4 (aggressive), or above line 3 (more conservative).
Chart Setup: The US Dollar Index has now reached it downside target from a large wedge pattern (lines 1-2)/head and shoulders.
Strategy Details: Look to go long. A close above line 4 will be the most aggressive buy signal. Whereas a close above line 3 will be more conservative. Or, go long on a bullish reversal week up. (Line 4 is at 95.92 on Monday 17th and it’s declining by 7c per day thereafter. Line 3 is at 96.96 on Monday 17th and it’s declining by 6c per day thereafter).
Target: Once the rally gets underway, and specifically once its breaks out above line 3, look for a rally to line 1 initially (98.28). But very likely to over the 100 level, and 101.50 med-term.
Stop-loss: A close below the low of the current correction. From 98 short-term traders tighten stop to a prior two day low.
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