The DXY is an important metric to take into consideration when trading any market. Most things are priced in USD still which means the DXY moving in price should move the price other assets. Historically what we see is an inverse correlation to cryptos, stocks, and equities. This means when DXY pumps other assets drop in prices and when DXY falls most assets pump in price. This is because of the inflow/outflow correlation of cash with said assets.
Here what we are starting to see for the DXY is support being held around the 100 level. We are starting to see the 3rd retest of this support zone (green box) act as support yet again. We have also created a bullish divergence on the 1D RSI giving even more strength to this theory.
Th US dollar is posed to lose dominance over other world currencies in the next months/years with the current economic trend we have been seeing, but from a short term trade the Dollar looks bullish. This could be to flush out the massive amounts of shorts that have been placed from the recent news events which could end up bringing some kind of short squeeze for the dollar. If the dollar pumps hard we should see other asset classes decrease in price.
Here what we are starting to see for the DXY is support being held around the 100 level. We are starting to see the 3rd retest of this support zone (green box) act as support yet again. We have also created a bullish divergence on the 1D RSI giving even more strength to this theory.
Th US dollar is posed to lose dominance over other world currencies in the next months/years with the current economic trend we have been seeing, but from a short term trade the Dollar looks bullish. This could be to flush out the massive amounts of shorts that have been placed from the recent news events which could end up bringing some kind of short squeeze for the dollar. If the dollar pumps hard we should see other asset classes decrease in price.