Despite DXY is suffering its biggest drop in several years, no major correction was detected for several weeks. This brings our team into conclusion that starting this or next week we are going to see a major reversal on DXY upwards. This will definitely affect all major currencies and bring the down for at least several weeks. Our forecast suggests that DXY will test levels of the middle of July 2020.
Another factor playing for this analysis is data from CFTC report highlighted on the chart. From the end of July we could see declining Open Interest and the amount of short position, which under a strong down trend plays against bears in this case.
Concluding we would recommend stop shorting DXY and start reversing your positions for a bullish momentum. Elsewhere in our team we pay close attention to shorts on GBPUSD, AUDUSD and longs on USDCAD.
Another factor playing for this analysis is data from CFTC report highlighted on the chart. From the end of July we could see declining Open Interest and the amount of short position, which under a strong down trend plays against bears in this case.
Concluding we would recommend stop shorting DXY and start reversing your positions for a bullish momentum. Elsewhere in our team we pay close attention to shorts on GBPUSD, AUDUSD and longs on USDCAD.