Hi Traders! US Dollar Index technical analysis and short term forecast is here. We do our analysis on the MetaTrader4 platform (MT4). Some very interesting and useful tips and hacks about the MT4 platform could be found here. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club Spoiler alert – free memberships are available!
US Dollar Index H4(4 Hours) Chart Analysis – Range Breakout, Heikin Ashi Candles, Lower Lows
On the H4 chart, the price was moving inside a range, this range is formed by the highs and lows reaching parallel support and resistance zones. The price which was respecting this range so far has currently broken below the bottom of this range and is holding below it. In addition to this, based on the Heikin Ashi candles we can see that currently, we have strong bearish bodies in downward moving market conditions so it basically reflects a bearish environment. We may consider these as evidences showing that the buyers are losing control and the sellers are having the upper hand. In addition to this the price broke below the last low at 108.992 and has created lower lows based on the MACD indicator which is a sign of gaining momentum towards the bearish side. So everything looks good here for the bears and we may now move down to lower timeframe and look for evidences supporting this short term bearish view.
US Dollar Index H1(1 Hour) Chart Analysis – Heikin Ashi Candles, Bearish Trend Pattern, Two Strong Resistance Zones
On the H1 chart, based on the Heikin Ashi candles we can see that currently, we have strong bearish bodies here as well in downward moving market conditions so it basically reflects a bearish environment. In addition to this, the price which is moving lower has created a bearish trend pattern in the form of three lower highs, lower lows which we may consider as evidence of bearish pressure. Generally, after a bearish trend pattern, we may expect corrections and then further continuation lower. Currently it looks like a correction is happening. Also, we had two strong support zones that has formed, the price moved lower broke below these zones and is holding below them, we may consider this as yet another evidence of bearish pressure. Currently, these strong support zones are acting as strong resistance zones for us. Until these two strong resistance zones (marked in red) shown in the image below holds my short term view remains bearish here and I expect the price to move lower further.
Technical Analysis & Forecast Summary
US Dollar Index H4(4 Hours) Chart Analysis
- Range Breakout, Heikin Ashi Candles, Lower Lows
US Dollar Index H1(1 Hour) Chart Analysis
- Heikin Ashi Candles, Bearish Trend Pattern, Two Strong Resistance Zones
Trading Tips
It is always recommended to look for confirmations before you jump into any trade. If you are not sure about how to trade this short term sell setup then you can use any setup and strategy that you have in your arsenal to look for bearish moves and join this sell trade.
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Happy Trading!
Arvinth Akash
Traders Academy Club Team.
