USD Shows Strength Off Major Support – Bullish Rejection Signal

usd index off range support

The USD Index has been deadlocked in this range for months now.

We recently seen a very convincing breakout back in August… but it collapsed as quick as it rallied.

Now we’ve tumbled back to the range support, which is a major structural level for this market.

These are the levels where you can expect the market to make reversals, and the price action backs that idea here by printing a bullish rejection candle off the level.

The rejection communicates strength coming back here defending the range bottom. If you look to the left, the previous test of support also produced a bullish rejection candle, which seen the USD follow through with a range cycle.

If this signal follows through, we could see another cycle of the range, and a push up to the range top.

Conversely, if the market breaks lower – I wouldn’t trust that, as these major levels are notorious for producing fake outs… don’t get trapped into those here!

 

And The Cycle of the Range Goes On…

strong range price action with sell signal

Wow!

Now that’s a nice bullish response from the range bottom. All aboard the rally train for sure.

No doubt this was an epic price action signal, but wait… there’s more!

Now the USD index is starting to print bearish signals at the top of the range, suggesting weakness is coming in and another range cycle is likely to happen.

Keep it simple with range structures, sell the top, buy the bottom when the price action evidence supports it.

Now we have a large bearish rejection candle on the range top, we can start thinking about how to structure a short position.

 

Strength Returns & Rolls Over The Bearish Signal

usd strength kills bearish range trade

We couldn’t have it so good two trades in a row 😀 Not all signals will be monster trades.

There initially was some bearish follow through from the range price action sell signal, however the follow through wasn’t sustained for line, and some strength started to seep back into the USD.

The bulls picked up the paced and drove the market higher, back up to the range top and rolled straight over the initial sell signal.

Looks like USD want to remain strong now, so if the range top breaks, we should be looking for further buy opportunities above the range top, to catch the next bull train.

Hope you caught something here!

Best of luck on the charts.

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4 Comments...


  1. Shah comment display photo
    Shah
    So the up coming fomc, dollar will be strong?

  2. jack comment display photo
    jack
    If you are such a good trader why bother with online marketing?
    1. Wayne Allen comment display photo
      Wayne Allen
      Actually, compared to other online Forex educators he doesn't,... in fact the lack of marketing/push actually put me off, until i started to read/watch his videos. As to your comment about why offer online courses/market if he such a good trader,.. this is a question i used to ask as someone looking for a mentor and i think it comes down to a number of reasons,.... firstly you could ask the same question of any educator of a skill based profession,... "If you are such a good builder why aren't you making money building and selling houses ..",... the answer i think is two-fold.1. If you spent the time/energy becoming good at something and developing a wanted skill, why wouldn't you maximize revenue, especially when you can do both at the same time.2. Trading, especially how TFG does it looking at the higher time-frames, does not require as much time as say day trading, and even then, trading can be quite boring day to day,... i'm sure he wants other challenges than simply making money via the charts.Also lets not forget,... if noone was there to teach, how can others learn.Just my 2 cents worth

  3. TRILL_4X comment display photo
    TRILL_4X
    One of the best to ever do it. Nice, clean and simple. Patiently waiting for a setup you understand and trust, at an area that has been a historical turning point its the absolute KEY! So smoothly done! Pat yourself on the back. #LiveYourBestLife
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