DXY (Dollar Index) Long term movement prediction for 2021
DXY / DX1! / USDOLLAR / Dollar Index is searching for liquidity, bouncing up and down in the process. This is my long term prediction on how it could move - given no major economic shifts.
Option 1
DXY breaks below the Q1 2018 lows, collects liquidity
It then runs up to fill in the fair value gap from Q3 2020
It then falls down and get rejected from Q3 2014 lows as those trapped shorts exit - creating a rally
It then falls down again below Q3 2014 lows to collect liquidity
Heads back up again in search of liquidity
Option 2
DXY creates a short term low just before Q1 2018 liquidity run, so that it can trap even more traders
It then runs up to fill in the fair value gap from Q3 2020
It then falls down, collects the liquidity below Q1 2018 lows
Get rejected from Q3 2014 lows as those trapped shorts exit - creating a rally
It then falls down again below Q3 2014 lows to collect liquidity
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