A few month ago I post a technical analysis of the US Dollar Index on twitter. It has played out as predicted and looking at a TP of around 103.00 for the USDX.
US dollar index forecast pic.twitter.com/ReyLxkoK6x
— Paul Placucci (@Scalp_FX) September 3, 2016
Price stopped short of the initial break out target, and an over extended pull back 2nd entry but plenty of profit in the trade.
A fed hike for December is now around a 95% chance. With the US economy acceleration continuing, and new fiscal policies next year will further stimulate the economy. I for see the Federal reserve making a further 2 or 4 hikes in 2017.
The USDX analysis was based on a controversial inverse head and shoulders pattern found at the top of an Uptrend with partial consolidation.
Typically an inverse head and shoulders is found at the bottom of a down trend. Formation commencing soon after price has bottomed out, without a consolidation phase. However some technical analysts have mentioned inverse head and shoulders patterns at the top of uptrend but without a consolidation phase.
At the time my Analysis was posted most other Analysts were posing further drops in the USDX and possibility the Feds cutting rates rather than hiking. Some dooms day sayers were even suggesting the US economy was about to crash at a worse of a degree than the great depression of the 1930’s.
Patterns can be spotted anywhere in the charts and we dont have to rely on text book theories. Technical analysis cannot be correctly analyzed without the back up of fundamental analysis and hence why we must learn both.
I see further inclination of the USDX to around 103.00, however we will see a correction some time soon.