DOLLAR INDEX - Is the USD appreciation already over?US Dollar IndexCAPITALCOM:DXYprofxedgeEnd of last week we published that we were - for the moment - closing all our dollar weakness positions. Now, why did we do that? Well, because if you look at the chart in the right timeframes, you will notice that structure-wise we are at a crossroads here and 2 possibilities are open at the same time: 1) we are in an expanding/regular flat correction (ABC marked in yellow) and we're coming for one more down move; 2) we ended the ABC correction earlier already (ABC marked in light blue), we then broke the trend and we're now heading for a bigger up move (bigger blue arrow on the right hand side of the chart). What is happening today on the smaller timeframes (such as 1hr, 30 min. etc.) would therefore be just a correction for more upside, in this last case. Now, some of you might wonder? Why on earth, given these very different structural possibilities, did we publish dollar strength (buy) setups on May 8? Well - and this is a key understanding in trading - because regardless of which was going to play out in the future, the 4 hour type of divergence we had at that moment (higher lows/lower lows) together with the retest of the low that held in place (red box) at the previous week's, low was an extremely high probability indicator that an up-move - to say the least - was going to happen. And in fact it did! So, having said all that, how do we go about and trade the dollar in the next few days? We have to check for a few things before we position ourselves for dollar weakness positions? 1. we wait and see if the price comes back fully inside in the range of the week before the last (last week and previous highs and lows are marked with the dotted blue lines) 2. if the previous point is confirmed we wait for a correction first, to confirm the intention to go further down. If both the previous points DO NOT play out, it will be a confirmation of scenario 2) above i.e. that the abc correction that actually played out was the one ended on May 6 (ABC marked in light blue) and for the time being we are in a dollar strength scenario, meaning we will take all buy setups that occur during this week and the next one at least. Updates will follow stay tuned and don't forget to follow if you feel that our analyses and setups are useful. Thanks