DXY 12/25/2020: Inverse Correlations
Diupdate
Note: NOT A FINANCIAL ADVICE TO BUY/LONG OR SELL/SHORT
_____
Good day Guys! Sorry if I can’t make you a short-term trading signals as I’m more focused on this holiday on what could be a one-year outlook of the market, specially on Cryptocurrencies which I trade more. I think this technical analysis is no longer new to you but you can learn the possibilities that may happened relevant in the day-to-day trading or even in investing.
In the Chinese New Year Calendar, year 2021 is the year of the Metal Ox. What is Ox? Search it on the internet. It’s bull. Sounds good right on the markets? Specially on Stocks and Cryptocurrencies. Hmm... I hope so it’s bullish. But I think, it’s better to be cautious on our biases than to be ruined our accounts.
In this TA, I consider both bullish and bearish scenario. Also, this TA is a continuation of other TAs found in the related ideas. Checked it.
For now, I’m trading on Bitcoin and no ALTcoins.
____
Technical Analysis
Monthly
EMA 9 - Green = 93.780
MA 50 - Orange = 95.886
SMMA 60 - Sky Blue = 92.190
MA 200 - White = 86.875
As you see in the monthly chart of US Dollar index (DXY), it breaks the support at SMMA 60 and move down further in the month of December 2020 as the price of Bitcoin and Stocks is generally increasing in value in the whole year of 2020.
In the first quarter of 2018, DXY is in accumulation phase and move up the rest of the year 2018 while Bitcoin is in distribution phase and then declining phase up to January 2019. In the previous price action in the first quarter of year 2018, DXY bounced on both SMMA 60 & MA 200 plus with a hidden bullish divergence both on weekly and monthly timeframe after that it moves higher and gives a toll against Bitcoin for a year.
I think MA 200 at 86.875 is a strong support which in confluence with Fibonacci Level 1.000 at 87.425 and previous price action in the previous years. I expect that the buyers may step in the price range from 86.875 to 87.425 for sure. But. There is something wrong on this MA 200 in Monthly Time Frame that is: “MA 200 is moving down as the months passes by”. Under normal circumstances, when the price is above MA 200 in any time frame definitely the trend is bullish as long as MA 200 value is also increasing”. But in this case, it’s decreasing. I think, if DXY came into this price range (86.875 to 87.425), it will create a confusion among traders and investors in general. I think it’s good to think a possible scenario in advance.
Scenario 1
If DXY creates a hidden bullish divergence or bullish divergence on RSI, Stoch RSI or in MACD (either in weekly or monthly) and holds support at MA 200 (in monthly), there is possibility of an accumulation phase in weekly timeframe, then a reversal of the trend and test the resistance above. Plus, a bullish fundamental on DXY. This scenario is bad for Bitcoin and Stocks in general, BUT (Scenario 2).
Scenario 2
If there is a break of support in both at 1.000 Fibonacci Level and MA 200 in monthly timeframe without any bullish confirmations or with more bearish confirmation and bearish news, I think this is very bearish for DXY but very bullish for Bitcoin and Stocks. (Continuation of declining phase from March 2020 to year 2021?)
Scenario 3 (very rare, take note of inverse correlation) – direct correlation, very rare.
If DXY creates a hidden bullish divergence or bullish divergence on RSI, Stoch RSI or in MACD (either in weekly or monthly) and holds support at MA 200 (in monthly), there is possibility of a reversal of the trend and test the resistance above. Plus, a bullish fundamental on DXY that may benefit Bitcoin and Stocks. (Too good to be true…. but what if)
Scenario 4 (Financial Crisis) – direct correlation, very rare.
If the whole market prices go down, I think, we have to wait for results of financial condition and performance for the year end 2020. If good result, nothing to worry. If bad result, be prepared. Generally, bad for Bitcoin, Stocks and Currencies.
Let's see next year 2021 on the turn of events.
It favors to go down further.
Weekly
I think it’s worthy to observed this……. Will history repeat itself? Or move lower?
Oh no! Bitcoin and Stocks…. Hehe
Daily.
Take a look that green arrow in confluence with weekly time frame. Be careful in making a position.
4 Hour
Next Update: Next Year.
_____
Note: NOT A FINANCIAL ADVICE TO BUY/LONG OR SELL/SHORT
_____
Good day Guys! Sorry if I can’t make you a short-term trading signals as I’m more focused on this holiday on what could be a one-year outlook of the market, specially on Cryptocurrencies which I trade more. I think this technical analysis is no longer new to you but you can learn the possibilities that may happened relevant in the day-to-day trading or even in investing.
In the Chinese New Year Calendar, year 2021 is the year of the Metal Ox. What is Ox? Search it on the internet. It’s bull. Sounds good right on the markets? Specially on Stocks and Cryptocurrencies. Hmm... I hope so it’s bullish. But I think, it’s better to be cautious on our biases than to be ruined our accounts.
In this TA, I consider both bullish and bearish scenario. Also, this TA is a continuation of other TAs found in the related ideas. Checked it.
For now, I’m trading on Bitcoin and no ALTcoins.
____
Technical Analysis
Monthly
EMA 9 - Green = 93.780
MA 50 - Orange = 95.886
SMMA 60 - Sky Blue = 92.190
MA 200 - White = 86.875
As you see in the monthly chart of US Dollar index (DXY), it breaks the support at SMMA 60 and move down further in the month of December 2020 as the price of Bitcoin and Stocks is generally increasing in value in the whole year of 2020.
In the first quarter of 2018, DXY is in accumulation phase and move up the rest of the year 2018 while Bitcoin is in distribution phase and then declining phase up to January 2019. In the previous price action in the first quarter of year 2018, DXY bounced on both SMMA 60 & MA 200 plus with a hidden bullish divergence both on weekly and monthly timeframe after that it moves higher and gives a toll against Bitcoin for a year.
I think MA 200 at 86.875 is a strong support which in confluence with Fibonacci Level 1.000 at 87.425 and previous price action in the previous years. I expect that the buyers may step in the price range from 86.875 to 87.425 for sure. But. There is something wrong on this MA 200 in Monthly Time Frame that is: “MA 200 is moving down as the months passes by”. Under normal circumstances, when the price is above MA 200 in any time frame definitely the trend is bullish as long as MA 200 value is also increasing”. But in this case, it’s decreasing. I think, if DXY came into this price range (86.875 to 87.425), it will create a confusion among traders and investors in general. I think it’s good to think a possible scenario in advance.
Scenario 1
If DXY creates a hidden bullish divergence or bullish divergence on RSI, Stoch RSI or in MACD (either in weekly or monthly) and holds support at MA 200 (in monthly), there is possibility of an accumulation phase in weekly timeframe, then a reversal of the trend and test the resistance above. Plus, a bullish fundamental on DXY. This scenario is bad for Bitcoin and Stocks in general, BUT (Scenario 2).
Scenario 2
If there is a break of support in both at 1.000 Fibonacci Level and MA 200 in monthly timeframe without any bullish confirmations or with more bearish confirmation and bearish news, I think this is very bearish for DXY but very bullish for Bitcoin and Stocks. (Continuation of declining phase from March 2020 to year 2021?)
Scenario 3 (very rare, take note of inverse correlation) – direct correlation, very rare.
If DXY creates a hidden bullish divergence or bullish divergence on RSI, Stoch RSI or in MACD (either in weekly or monthly) and holds support at MA 200 (in monthly), there is possibility of a reversal of the trend and test the resistance above. Plus, a bullish fundamental on DXY that may benefit Bitcoin and Stocks. (Too good to be true…. but what if)
Scenario 4 (Financial Crisis) – direct correlation, very rare.
If the whole market prices go down, I think, we have to wait for results of financial condition and performance for the year end 2020. If good result, nothing to worry. If bad result, be prepared. Generally, bad for Bitcoin, Stocks and Currencies.
Let's see next year 2021 on the turn of events.
It favors to go down further.
Weekly
I think it’s worthy to observed this……. Will history repeat itself? Or move lower?
Oh no! Bitcoin and Stocks…. Hehe
Daily.
Take a look that green arrow in confluence with weekly time frame. Be careful in making a position.
4 Hour
Next Update: Next Year.
_____
Note: NOT A FINANCIAL ADVICE TO BUY/LONG OR SELL/SHORT
Catatan
Most relevant related TA:
Publikasi terkait
Pernyataan Penyangkalan
Informasi dan publikasi tidak dimaksudkan untuk menjadi, dan bukan merupakan saran keuangan, investasi, perdagangan, atau rekomendasi lainnya yang diberikan atau didukung oleh TradingView. Baca selengkapnya di Persyaratan Penggunaan.