The DXY might hold the key to the markets direction following this Wednesdays FOMC & rate raise. Let's take an objective look.
Things to note: - LT Resistance 111.50 - 112.34
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- Possible test of LT resistance coinciding with the FED FOMC meeting & rate raise Sept 20-21 - Price holding 9SMA as support but it's going sideways (if turn down that's bearish) - Major support @ 50SMA back-tested successfully Sept 13
- LT Support channel @ 106 - 107 - RSI getting up there on the daily TF
Being objective, this charts currently looks more bearish than bullish. Why? The 9SMA sloping down does not look healthy for the bulls.
With that being said, A LOT can happen in 2 days. IF we continue trending up from here, I'd be weary of a sell-off on the DXY surrounding the FED.
BUT IF we cool-off here & get a re-test of the 50SMA & a bounce with the risk-on assets, I'd be looking for a pump with the FED. Remember, still too early to call. Lots can happen between now and Wednesday so remain objective & follow the charts!
This post is based on this twitter thread.