The new year is here and traders are ready to trade once again. The first official trading day of 2021 was eventful and also very informative for what’s to come in the next twelve months.
Throughout the new year celebrations, the US Dollar Index (DXY) was able to gap down to the December low of 89.50. This is on par with price action and smart money analysis which is bearish on the Dollar for the long-term. The next target in mind is the low of 2018 which was made in December.
As traders await the next leg down for the Dollar, a few setups are priming for an entry. EURUSD has created a double top pattern and the price has sold-off considerably. Traders should not put too much emphasis on this pattern as the long-term bullishness is still there. Entries long are warranted once the price clears last year’s high. USDCHF shorts is also a probable and promising trade idea. Traders should observe the daily closure to determine possible entries.
Many traders are ready to dive into trading as they spent the past few weeks as observers of the markets instead of participants. It’s good to note that there is a full year ahead and that trades should be eased into. It’s not necessary to make a year’s worth of profits in one week or a month. Take it slow, and the markets will be sure to reward you.