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Forex pairs in this Article » EUR/USD, GBP/USD, USD/JPY
- Dollar trades at important resistance as markets remain uncertain

- Forex cycle studies suggest the middle of the week is critical for the EURUSD

- US Dollar coiling up for a big move, but we need to see confirmation before trading it

The US Dollar continues to coil up for its next move versus the Euro and other counterparts. But how might we trade it? These are the factors we’re watching.

An important Dollar bounce leaves the Dow Jones FXCM Dollar Index at important resistance, and we’ll need to see conviction in its next move to have confidence in our earlier calls for an important USD bounce.

Indeed last week we pointed to potentially significant sentiment extremes as a key reason the Greenback was set to surge higher across the board.

A look at market cycles and time studies suggest the next major Dollar move versus the Euro may have to happen midweek to take confidence in calls for an important EURUSD top.

Euro Continues To Move Sideways at Potentially Critical Resistance

forex_trading_the_US_Dollar_breakout_versus_euro_body_Picture_1.png, US Dollar Coiling up for Big Move, but What are the Trades?Source: FXCM Trading Station Desktop, Prepared by David Rodriguez

This makes trading admittedly difficult as it makes sense to stand pat until we see a major break in either direction. Yet “flat” is certainly a position as markets remain especially uncertain.

We’ll keep a close eye on the US Dollar against the Euro, Japanese Yen, and other counterparts for trading opportunities. Take a look at full strategy preferences below and sign up for future e-mail updates via my distribution list.

Forex Volatility Prices Point to Slow Dollar Moves in the Week Ahead

forex_trading_the_US_Dollar_breakout_versus_euro_body_Picture_2.png, US Dollar Coiling up for Big Move, but What are the Trades?Source: OTC FX Options Prices from Bloomberg; DailyFX Calculations

DailyFX Individual Currency Pair Conditions and Trading Strategy Bias

forex_trading_the_US_Dollar_breakout_versus_euro_body_Picture_3.png, US Dollar Coiling up for Big Move, but What are the Trades?forex_trading_the_US_Dollar_breakout_versus_euro_body_Picture_4.png, US Dollar Coiling up for Big Move, but What are the Trades?Automate our SSI-based trading strategies via Mirror Trader free of charge

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