US Dollar Index 2012-02-14

We are looking at the US dollar index 2012-02-14, march contract, on a 60 minute futures trading chart. We can see an MACD-price divergence pointed out by the red and green lines. The green arrows indicate swing trading long entry points. I traded the MACD divergence successfully, but I missed the two entry points along the yellow moving average because I was doing other things away from my "trading office". I will be looking for more entries following the swing trading strategy until I see an MACD divergence indicating a top on the 60 minute trading chart. I expect there to be another 1 to 3 entry opportunities before the next MACD divergence occurs, we'll see though.

This upswing in the dollar index is occurring at the same time that we are seeing MACD divergences in the three major US stock indices (s&p;, nasdaq, djia) as well as in gold and silver. This tells me that we may see a slip in the stock markets and metals soon, but only time will tell. It could well be that we see an enthusiastic quick rise first, but the action of the dollar index is telling me otherwise.

In addition to trading the US dollar index from the long side, I'm also trading sugar from the short side. I'm looking for moving average entry points using the swing trading strategy in both cases, waiting for an MACD divergence to tell me to stop.

If you are unfamiliar with the MACD divergence and swing trading techniques described in this market commentary, go to the trading strategies page of this website and learn how to identify them as well as how to apply them in combination. If you are interested in learning more about these techniques, check out some of the book reviews I've made by going to the reviews page.

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