The DXY index has printed a fresh 48-day high during the intraday rally.
Markets remained in volatile sessions as we head into the mid-week.
Re-assessing the US Dollar DXY index high timeframe candles:
Yearly Candle: Last check is a Green Shaven Bottom with a Diminishing Head Wick now a Green Body
Monthly Candle: Previous close is a Green Long Lower Shadow current is a Green Body
Weekly Candle: Previous close is a Green Small Bodied Doji current is a Green Body
Daily Candle: Previous close is a Green Body with a Longer Head Wick current is developing a Small Green Spinning Top
The strong March macroeconomic reports has sustained for DXY bids resulting in a 25-day uptrend continuation.
The last time I checked DXY’s March candle, it was in a green dragonfly doji formation that has extended its bullish trajectory by closing in a green long lower shadow.
Today’s high has broken yesterday’s top and according to the current daily candle formation mentioned above, we can see a bullish opening gap.
This gap must not be fully retraced if the index wants to continue higher avoiding a double daily top formation.
Trade Plan
With the DXY refusing to give up the newly reclaimed 105 level, I think the index will continue to rally upwards challenging the strong 105.50 to 106.60 premium levels.
My plan is to set a bid on potential pullbacks, and wait for them patiently.
Although, the current price is a tempting buy position but better to observe and wait for pullbacks first.
New buy orders:
Buy Entry: 104.75
Stop Loss: 104.40
Take Profit: 105.90
Risk to Reward Ratio: 3.29
Conclusion
Whether or not the intraday opening gap is fully retraced, the Greenback will have lots of buybacking pressures.
This is what I see for now.
I’m targeting the November 10, 2023 swing high order blocks to take profit while setting up a stop loss below yesterday’s low.
Trading involves risk.
Full read:
https://www.finlogix.com/analysis/20240402/dxy-intraday-analysis-and-trading-plan-for-april-2-2024
