There's Our USD Swing – Right On Time

As suggested there on Friday “if” we saw an expected turn upward in USD ( or at least…I was expecting it ) this is clearly a “swing low” at a fairly significant area of support.

This could possibly be a very significant “low” for USD, marking “the bottom” of what could turn out to be a very powerful new set of “higher highs” and “higher lows”.

All trades suggested on Friday – moving in the right direction.

Otherwise, The Australian Dollar continues to baffle as “risk is clearly expected to come off” here in coming days and weeks.

The Nikkei taking a bump up this morning –  and that’s “all it is” a bump up, as you’ll recall – nothing moves in a straight line for long. This too…soon shall pass.

We’ve moved from an environment of “buying the dips” to now “selling the rips” so…..you better get your head wrapped around it.

Stocks can and will “fall further” over the coming weeks, if not months.

Over the weekend I’ve had incredible interest in the “Members only / paid services” area – thank you. I’m only a day or two away so for those who’ve already contacted me so I will get back to you via email as to login / site address etc. The payment system will be Paypal based so please be aware and maybe even look ahead. You’ll need a paypal account in order to subscribe/use credit card. It’s a snap to set up.

The USD Reversal Strategy: Reading Support Like a Pro

When I called Friday’s move as a potential swing low for USD, it wasn’t wishful thinking—it was technical discipline. The price action we’re seeing now confirms what every serious trader should understand: significant support levels don’t just hold randomly. They hold because institutional money recognizes value, and that recognition creates the foundation for powerful reversals.

This isn’t your typical retail bounce. We’re looking at a structural shift that could define USD strength for months ahead. The key is understanding that USD weakness phases don’t last forever, and when they reverse, they reverse hard.

Reading the Risk Environment Shift

The Australian Dollar’s recent performance tells you everything about where we’re headed. AUD strength in a deteriorating risk environment is a classic late-cycle phenomenon—it’s the market’s last gasp before reality sets in. When risk assets start their real decline, currencies like AUD get crushed first and hardest.

Smart money is already positioning for this shift. While retail traders chase momentum in risk currencies, professionals are building USD positions at these levels. The Nikkei bump we saw this morning? Pure technical noise. The underlying current is flowing toward risk-off, and that current always favors the dollar.

From Buying Dips to Selling Rips

This transition is critical for your trading psychology. The ‘buy the dip’ mentality that worked for years is now a wealth destroyer. We’re entering a period where every rally becomes a selling opportunity, every bounce becomes a fade. The traders who adapt fastest to this new reality will capture the biggest moves.

The USD swing low we’re seeing isn’t just a technical pattern—it’s the market’s recognition that safe haven demand is about to explode. When stocks break their key support levels in the coming weeks, guess where that money flows? Straight into dollars. This is market positioning 101, but most traders miss it because they’re too focused on daily noise.

Currency Pairs to Watch

EUR/USD is setting up for a major breakdown below parity. The European energy crisis isn’t going away, and ECB policy remains dovish compared to Fed hawkishness. Look for continuation patterns on any bounce toward 1.02-1.03 resistance.

GBP/USD faces similar pressure, but with added political uncertainty. The pound’s correlation with risk assets makes it particularly vulnerable as global growth concerns intensify. Any move back toward 1.25 should be sold aggressively.

AUD/USD is the poster child for this risk-off environment. The commodity currency complex is about to get hammered as China’s growth slows and global demand weakens. Target the 0.65 level over the next month.

Position Management in the New Regime

Your position sizing needs to reflect this new market structure. USD strength moves tend to be violent and sustained, which means your winning trades can run much further than you expect. Don’t take profits too early on USD longs—this could be the start of a multi-month trend.

Risk management becomes even more critical when trading regime changes. Use wider stops but smaller position sizes initially. As the trend confirms, you can add to winners and tighten your risk parameters.

The technical setup we’re seeing in USD reminds me of major turning points from the past. These don’t happen often, but when they do, they create generational trading opportunities. The key is recognizing the shift early and having the discipline to ride the wave instead of fighting it.

Friday’s trades are moving in our favor because we read the setup correctly. This is what happens when you combine technical analysis with macro understanding and risk management discipline. The USD bottom could be behind us, and the next phase higher could be spectacular.