I have been playing a dollar long position since the pullback reached the top line of the Wave (34EMA high). This decision was not random but instead was based upon the criteria of my swing trading:
1) uptrending market
2) pullback to support
The dollar definitely pushed the envelope on the correction as prices made a low at 87.46. now remember this is the dollar index which is a futures contract BUT it does offer p-l-e-n-t-y of insight into what major pairs are likely to do. Case in point, the EUR/USD and 1.3000.
If the dollar index is not going to stay below 86.50 there is not going to be a sustained break higher on the fiber.
Falsi breakouts can be identified and avoided when you look at correlations. Remember though that correlation comes second to the primary set up…in other words, just because I am long one market does not mean there is a *knee jerk* trade in another…
On a personal note, thanks for all the well-wishes, I do appreciate it and I think this is the first week that I am actually feeling like the week won’t kill me…for that I am very happy! So we’ll be busy this week especially with Wednesday FOMC coming.
In fact tomorrow, we’ll take a god look at the Fed Funds contract and I’ll show you how to do some Fed Funds math!
This content is strictly for informational purposes only and does not constitute as investment advice. Trading any financial market involves risk. Please read our Risk Disclosure to make sure you understand the risks involved.