The balance of supply and demand in the USD index shows that the dynamics are slowing down, which can only mean one thing: the dollar is weakening and there is a high probability of a decline.
Moreover, experts from The Goldman Sachs, UBS Asset Management and Invesco predict an inevitable fall in the US dollar, and the reason for this is the growing popularity of US presidential candidate Joe Biden.
However, it is too early to draw conclusions, especially since the scenario may become the same as the predicted victory of Hillary Clinton in 2016, during which the forecasts of many experts did not come true. Perhaps, this time, they will not happen as well.
Nonetheless, traders avoided taking risks, thereby closing long positions before the weekend. All this led to a breakout below the lower boundary of the medium-term upwards channel.
It seems that the trend in the market is now changing from “bullish” to “bearish”, and this can be seen in both the RSI indicator and the MACD line.
Thus, in the future, fueled by Biden’s victory in the elections, as well as the appearance and distribution of a coronavirus vaccine, the dollar index could reach 91.75, with which the bears will bring the dollar to 88.00, the yearly low in 2018.
But, it is possible to avoid this “bear” trap by waiting for a further decline, which should absorb demand. Thus, traders should wait for a close below the September lows (near the 93 mark), or for an upward correction before entering the market.
However, if traders prefer an aggressive strategy, sales can be carried out right now, but this is very risky, since a breakdown of the lower boundary by less than 0.5% may result in a “bear” trap.
The material has been provided by InstaForex Company – www.instaforex.com
🚀If you want to get a Forex Robot Coded as per your trading strategy but are unable to do so because of the high price for the Robot then you can take advantage of the CROWD FUNDING campaigns feature. ✔ These are some crowd funding campaigns for Forex Robots, which when completed can provide the very same Forex Robot to the participants at an average price of $5-$10 per participant. ✔ You either participate in one of the already listed campaigns or send us your Forex strategy : Submit Crowd Funding Campaign , for which you would like the Forex Robot to be coded. A Crowd Funding Campaign would then be started for the same . ✔ All you have to do later on is to share the campaign online with your friends to encourage more people to participate in the campaign.
As a result, each participant can get that Forex robot for just a campaign contribution of $5 (which is the minimum). Participants can back the campaign by anything above or equal to $5 to reach the funding goal to close the campaign.