The US Dollar Index is an index of the value of the USA dollar relative to a basket of foreign currencies. Soon, we will cover more about Dollar Index when we post educational content.
Last two weeks we had dollar strength which put other pairs down and, you can see this if you check pairs that are traded against US Dollar. These moves happen from covid situations and, political things that happen in the USA.
We saw the US Dollar at highs of 100 and lows of 90.00 and, now we are trading between 92.50 and 95. Everybody is interested to know what will happen next?
Last Friday we had NFP, which is a vital economic data released shortly after the month ends and, we need to know what NFP tells us because, job creation is an important leading indicator of consumer spending, which accounts for a majority of overall economic activity.
Last week candlestick is bullish but, it’s not a bullish one as we want to confirm further bullish movement. This is the reason why we have to dig deeper in lower time-frames to find interesting areas where this pair can go.
Daily time-frame we have evening star formation which indicates that potentially price will go down but, due to NFP news, we had a bullish day for DXY. This is the reason why I will only watch the market on Monday then see if we have any trade on Tuesday or Wednesday.
4-hour time-frame we are on a downtrend because we break the last higher low, so in lower time-frames, is indicating a downtrend momentum. I will be patient on Monday and I will see how DXY is reacting between 92.200, 92.300. If we reject here I will think for taking longs for example on Eurusd.
This is my opinion about these pairs. Before you enter into a trade you should analyze by yourself!