Today I wanted to bring your attention to how we look and analyse the markets, looking at in particular the Dollar Index (DXY) & Euro (EUR).
On Tuesday 1st October we sent out the below video to our members via Telegram.
We know with DXY it is heavily weighted against the Euro so what we see happening with the Dollar Index chart indicates potential opportunity with the Euro.
For those of you who are not in our free group you can have an exclusive look at our analysis video by clicking here or the image below.
As you would have seen in the video the markets presented us with opportunities to profit on long euro moves.
Looking below shows exactly what we saw happen with EURCAD as a perfect example of this.
A number of the members shared results of their trades over the past couple of days as they took multiple short term long positions catching momentum as price rose.
For those of you who do not know, the Dollar Index consists of 6 currencies which are the Euro (EURO), Yen (JPY), Pound (GBP), Canadian dollar (CAD), Krona (SEK) and the Franc (CHF).
Now you may be asking why we look at the Euro in particular against DXY.
So although DXY is only made up of 6 currencies the amount of countries it consists of is very different, a total of 24.
Because of this the index components are given a weighted average.
Bringing us back to the Euro.
There are 19 members of the E.U. who have adopted the euro as their sole currency meaning the “weighted average” against the dollar index is much more when compared against the other currencies mentioned above.
In fact it takes up around 57% of the total weight of the U.S. dollar index.
What does this mean for you?
Well when looking at the charts you will see that DXY & EUR is a mirror image of each other.
Dollar Index 3rd October 2019
EUR/USD 3rd October 2019
The Dollar Index is a great place to start any analysis every morning to cut through a lot of the noise and narrow down your watchlists.
By then using this to start off with you can look to cherry pick potential opportunities which then meet your strategy rules.