#Fibonacci Fan 3rd Method on USD

3rd Technical Approach On #Speed Price Support & Resistance on DXY

The tech approach selected in this case is to apply the Fibonacci Fan Speed Price Resistance / Support projected fan levels where one can find the median line have been drawn from the lowest to the highest price pint of reference. Which also includes the declining channel from the US Dollar's turning price reversal at its high levels 100.49 figure projected towards the two succeeding lower highs. 

The similarity between the Gann Square and choosing the Fibonacci as the most effective tech tool to apply has been proven time and again. It is knowing which of so many tech tools to apply is the key. Seldom does such an approach is applied on trading; due to the speed and volatility that the price action has made after absorbing the fundamental reports released. The color coordination would simplify the analysis as described on the chart.

       Fibonacci 3rd Method On Speed Price R/S

Dow Retest A Surging Bull

Dow Jones Industrial Average

Expecting the unexpected can be as dramatic as the surge in stocks coming from several weeks of sliding prices. Technology and the Financials have provided the lift with investors following suit with the much needed volumes to push prices to its biggest one day gain which has covered some ground. A follow through id needed and staying above previous highs would be the key for a validation of directions.

Although, volumes were not considered a volume reversal that triggered a price reversal, it was enough as investors have been dragged again with some positive signals coming from Greece contrary to the IMF global growth outlook on the economy which included the US. However, it was to no surprise that the rally will move on both sides of the market as time and again made mentioned, that this would be the pattern for prices as they swing in both directions. 

Knowing the 'tolerable limits' and 'range parameters' on these price levels are excellent as the Dow continues to hold ground @17500 until now while the recent low on the Dow registered @17714 which pulled back on the day which provided the 1st signal of a probable price change. As a retest to hold above the 18000 on the Dow for the coming weeks would be a critical level. Although, this would be an encouraging sign for long tern trades held since the overall picture remains on the positive tone. 

Remember, that there will always a major correction within a major trend. All we need to do is to be able to pinpoint the pivotal price change on the next turn.

Price Action Analysis: EUR & GBP vs. DXY

The hype played on the NFP again have dampened most of the market's mix sentiments, as the data released were well within expectations that somehow overshadowed the Dow's surprising triple digit decline.

Although, there were some early signals from the previous week's reports on Wall Street that most institutional money managers have indeed started to unload some positions before the decline materialized yesterday.

Meanwhile main-street investors were encouraged with the some companies performance after the market sessions such as Facebook and Twitter have suffered the most from this decline. But today's figures have initially placed a cap on the Dow and the S&P which has been correlated with the geopolitical uncertainty that would affect the European community which would spill over towards the American market in the near term. Certain market distortions are in place as the backdrop of these tensions on the geopolitical front weighs on investors sentiments that allows price volatility to come & go after certain market moves have been made.  Click here

Identifying US DXY Price Reversal

Trend-following the US Dollar Index 'DXY' from its Pivotal price point and reversal formation since the week of July 01 has proven to be a classic pattern where the first signal came through and a follow-through breakout came after the prices stayed above the all important key price level @80.05 on the way higher.

Daily DXY & Weekly Comparative Overlay Chart

Likewise, the shortened trading week on the fourth of July have given the USD Index a typical symmetrical triangle formation on a technical perspective from the its previous corrective price move with a registered low @79.74 basis point figure as shown on the green-circled of a reversal three bar cluster-formation. This is over and above of the positive jobs numbers that fueled the US Dollar recovery and the rally on the Dow Jones Industrial Average & SP which is nearing the 2K mark.

However, the more important process of Cipher3 Analysis is comparing the DXY with the corresponding Futures prices with DXU14 & DXZ14.pdf (On Demand Subscription on Website) where the actual confirmation signal of a probable breakout to the upside was in the making; when the Price Reversal couple with volumes have shown on their respective charts in the attached link of a PDF file on the DX Futures.

NOTE: Monitoring the Futures DX is a sequence of process where the objectives of the prices can either be achieved in reaching their respective supports and resistances ahead of the spot DXY. In these two contract months, the registered lows both dated last 05.08.14 were @79.05 for DXU14 & @79.24 respectively. These reference points are part of the variable reference of importance.