DXY Forex Analysis 5 July to 9 July 2021
Last week, we predicted that the price for DXY will continue to the upside. The price action did move to the upside however, the resistance it met was a little more than we expected. I have marked out a strong area of historic resistance and we think price will continue to be range bound before finding conviction to make a larger move to either side. The long term bias is still to the upside but price action can be rather indecisive for the coming week. I have no preferred case for the next week, but always prefer to go with the bigger trend such that in case short term price action goes against me, I can turn the position into a longer term hold. As usual let’s dive into the bull case.
BULL CASE
If the bulls remain convicted, we should see a quick rebound from the 92.000 level to continue the upward movement. However, we need to be prepared for heavy manipulation to liquidate over-leveraged players who entered at the 91.500 levels. Please proceed with a more active management of your risk for the coming week by reducing your position sizes are by setting tighter stops.
BEAR CASE
If bears find conviction next week, price should burst the 91.500 levels for liquidity. This could trigger farther downside to around the 90.500 level before price rises sharply back up to fulfil the bull case we talked about last week.
