US Dollar Pivot?

 

US DOLLAR PIVOT?

The US Dollar Downswing Found A Price Support Barrier

usd2As the US Dollar continued it’s pull-back to it’s extreme pivot point around 97.50, I was patiently waiting for a single day’s price range (or, more importantly, several day’s price ranges) to be both below the 97.50 price level and also trending lower on a daily basis.

This did not happen this week. Although the US Dollar was at it’s most vulnerable point, not a single daily price bar or candlestick had it’s complete range below 97.50, but, we were ready in case it did.

This is a good time to examine a seemingly-forgotten fundamental of trading the markets.

There is one thing that will happen to all traders and is, in fact, a Rule of Nature: TREND WILL CHANGE!

How does one place themselves into the proper mind-set for these inevitable points of maximum stress?

In order to catch major trends, we must be ready to reverse trends at the true TURN POINTS.

At these critical pivot points, we look for confirmation of: PRICERANGE and TREND .

usd3

While these turn or pivot points do NOT always occur at highs or lows as most suspect and do not occur where one would assume it to be ‘logical’, we can further confirm their validity by applying these above 3 factors around these mathematical pivot points of price.

As was written in last week’s report: “Without the specific knowledge of these true turn points, the best we can do is to follow the markets closely while keeping an eye on timing and other indicators to confirm or deny what we’re seeing on the price charts.”

Keep in mind that the US Dollar is still flirting with it’s prior Highs and those highs will pose the greatest resistance to the upside in prices.

As for the downside possibilities . . .

Remember the pivot price point mentioned (97.50 with complete daily ranges below this number as well as lower highs on those daily ranges) as present prices are subject to some manipulation this week due to interest rate concerns and a sharp reversal to the downside is still a possibility.

When we:

  • have a checklist of ‘market-approved’ or Natural-law-based techniques and
  • are watching the market for signs confirming the trend using those techniques and
  • are ready to act with a plan-of-action

Then, we’re ready for what comes our way in the markets.

Remember, CHANGES IN TREND ARE A CERTAINTY, be ready with a counter-trend Plan. – George

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