Daily Market Analysis

Hello, my beautiful readers. This week, we continue our critically detailed look at the markets in hopes of getting profitable trading opportunities. As usual, I'll be starting with the DXY (US Dollar Index) since it holds considerable sway over the Major currency pairs.

The most prominent technical factor that jumped at me as soon as I saw the chart though was the wedge I marked above.

If you've followed my analyses closely for a while now you'll already understand why I always look to the price action on the DXY (US Dollar) chart for clarity on how to approach trading the major pairs. Looking at the chart above, we see clearly the descending wedge leading price off right into the PIVOT demand zone

A comparative examination of the strength of the US-Dollar often gives tangible insight into the direction of Gold (XAUUSD). The chart above indicates the expectation of a bullish price reaction from the demand zone.

A comparative examination of the strength of the US-Dollar often gives tangible insight into the direction of Gold (XAUUSD). The chart above indicates the expectation of a bullish price reaction from the demand zone

The US Dollar has been remarkably sluggish for the past few weeks despite being within a distinct Demand zone. My expectation of a springing rebound off the demand zone has not exactly played out yet, however, the zone remains unbroken.

For those who may be unfamiliar with Price Action trading, the horizontal arrows represent areas where the market structure was broken. As you can see in the scenario above, price broke below the previous low at the two marked instances

The views here are solely based on Technical Analysis techniques using my personal Smart Money approach. Hence, it is important to understand that the trading of CFDs comes at a risk; if not properly managed, you may lose all of your trading capital. To avoid costly mistakes while you look to trade these opportunities, be sure to do your own due diligence and manage your risk appropriately.

Even though we've only witnessed sluggish movements from the Dollar over the past few weeks, the general idea and bias still seem intact and untampered. The bullish impulse however can be seen as "searching for support".

Suddenly, the US Dollar Index fell 6.70% over the last two weeks, marking the biggest decrease in the currency since 2020.

Usually, the Dollar and GOLD are negatively correlated. This means that the stronger the US-Dollar becomes, the lower Gold prices will be as many more investors will prefer liquid investments. Times of crises and the need to safeguard funds are the major exceptions to this.

As I earlier indicated in my article this week, I am expecting an upward push from the Dollar as a reaction from the Demand zone I have marked out. The PPI release earlier moved prices a bit but lacked sufficient momentum to cause a significant break of structure - and thus, no change of trend.