DXY at the daily view.
The dollar strength bouncing shouldn't be a surprise at all. The DXY has been bouncing off the RSI uptrend support since early August. However, the dollar did NOT close September above that green dashed line which was its 11-year-old channel. That doesn't bode too well for the dollar strength. That said, the DXY is probably not done with this bounce yet. The RSI resistance has been relatively consistent. If not, the trend line resistances are also very consistent. This means that we might have some pullback left before going down again.
That said, I am seeing some selling activity in the TIP ETF which tracks/expects inflation. With no stimulus bill in sight, it is possible that the dollar strength might increase due to the lack of inflation. Will a stimulus bill be passed so the Federal Reserve get extra ammo? Eventually it will, but not now. Election season and the Supreme Court Nomination are at the forefront of DC's minds.
In all actuality, politicians probably won't approve a stimulus bill unless their OWN investment accounts are in danger. It's as if they are all self-interested human beings or something...
As the dollar gains more strength, the NQ and precious metals may delay a breakout rally for a while. That said, this rally can only go so far before breaking RSI support. Eventually, when election season is over, stimulus bill talks might resume.
But that's all in the more distant future. I'm more worried about what will happen in the next week or two for my swing trades.
The dollar strength bouncing shouldn't be a surprise at all. The DXY has been bouncing off the RSI uptrend support since early August. However, the dollar did NOT close September above that green dashed line which was its 11-year-old channel. That doesn't bode too well for the dollar strength. That said, the DXY is probably not done with this bounce yet. The RSI resistance has been relatively consistent. If not, the trend line resistances are also very consistent. This means that we might have some pullback left before going down again.
That said, I am seeing some selling activity in the TIP ETF which tracks/expects inflation. With no stimulus bill in sight, it is possible that the dollar strength might increase due to the lack of inflation. Will a stimulus bill be passed so the Federal Reserve get extra ammo? Eventually it will, but not now. Election season and the Supreme Court Nomination are at the forefront of DC's minds.
In all actuality, politicians probably won't approve a stimulus bill unless their OWN investment accounts are in danger. It's as if they are all self-interested human beings or something...
As the dollar gains more strength, the NQ and precious metals may delay a breakout rally for a while. That said, this rally can only go so far before breaking RSI support. Eventually, when election season is over, stimulus bill talks might resume.
But that's all in the more distant future. I'm more worried about what will happen in the next week or two for my swing trades.
Comment:
Just to clarify, the RSI support bounced off 3-4 times. I wouldn't be surprised if we see a pullback first.
Comment:
And RSI support just broke. Time to redo the dollar structure.