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The USD Index broke out of its range this week but failed to establish a new trend. The price immediately found support at the next swing low and is now back, retesting the previous lows. If the lows now become the new highs, the mood could shift towards a more bearish oriented market. However, a successful retest could foreshadow a downward continuation.
The USD breakout also triggered my USDNOK short which has been my trade of the week so far. A classic continuation after the buyers ran out of steam. The bullish exhaustion was very obvious last weekend and I jumped on the short signal early this week.
The take profit was hit precisely and the price has been bouncing around the lows ever since. A lot depends on the USD Index now. Going forward, I would caution of getting involved in the USD/NOK because we lack the overall structural context. Traders are better off trading other USD related pairs that are closer to actual turning points. The USD/NOK does not offer high probab...
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