In the chart shown DXY has bearish Divergence on two hour tf. In simple terms Bearish Divergence occurs when we have Price making higher highs and oscillator making lower low for example, we can see in the chart that DXY make a higher high and Momentum made a lower low today. Just the opposite goes for bullish divergence.
I have highlighted Two areas of price action and Momentum waves. The one is RED is causing the bearishness in DXY right now. Why?
Because there is an imbalance of Buyers and in the Yellow Circles than the sellers from the Red Circle. This is calculated using the number of buys/sells and the amount of each buys/sells that has taken place in each candle in both the circles.
If the total number of people buying right now is not going to overcome the number of sellers (these are the people who were the buyers in) in red circle. Now they are sellers because they are in profit. This is going to create selling pressure on DXY and bring DXY down. Another thing to note is DXY has been over bought for a while on Weekly without having a chance to cool down. This means, the number of new buyers coming into DXY is reducing weekly, even with the news and all, the buyer exhaustion is going to affect DXY movement in coming weeks and months. This is bearish for DXY because it has become too heavy right now, and the heavier it gets the more force from buyers is needed to keep pushing it even higher, which is very unhealth for DXY overall. When it falls it's going to fall hard.
I have highlighted Two areas of price action and Momentum waves. The one is RED is causing the bearishness in DXY right now. Why?
Because there is an imbalance of Buyers and in the Yellow Circles than the sellers from the Red Circle. This is calculated using the number of buys/sells and the amount of each buys/sells that has taken place in each candle in both the circles.
If the total number of people buying right now is not going to overcome the number of sellers (these are the people who were the buyers in) in red circle. Now they are sellers because they are in profit. This is going to create selling pressure on DXY and bring DXY down. Another thing to note is DXY has been over bought for a while on Weekly without having a chance to cool down. This means, the number of new buyers coming into DXY is reducing weekly, even with the news and all, the buyer exhaustion is going to affect DXY movement in coming weeks and months. This is bearish for DXY because it has become too heavy right now, and the heavier it gets the more force from buyers is needed to keep pushing it even higher, which is very unhealth for DXY overall. When it falls it's going to fall hard.