TVC:DXY   U.S. Dollar Currency Index
581 11 28
Finally the dollar is ready to rally. It's breaking ou of he double bottom .
I'M expecting it to break out of the channel in the following 2-3 weeks.

It is important for gold             - finally it can show up some correction with the strengthening dollar.

The strong dollar will have no effect on oil             though.

Target : 98-99.
"The strong dollar will have no effect on oil though." How so?.......
chartwatchers chartwatchers
Green boxes when dollar is rallying with oil.
No significant correlation. You cant build a strategy on the strong dollar when oil is coming out of a multi year bottom.
larry chartwatchers
I don't see any dislocation between the dollar and oil. Sure, on short-term occasions, both can move in tandem (implying little or no correlation), but if you look at the bigger picture—say when the dollar took off in 2014, or more recently, when the the DXY sold off for several weeks (with financial pundits and traders calling an end to the dollar bull market)—you can clearly see the inverse correlation between the dollar and oil. Also, the recent scramble in commodities (with oil, silver, gold, coal, steel, corn—you name it) surging since the beginning of the year is due to a massive credit injection coming out of China and notable dollar weakness. In essence, this is a typical "inflation trade." But in the end, when we see the DXY resuming its run in the coming weeks, I don't see how the commodity complex can sell off with oil remaining immune to such pressures. Note also that WTI Crude speculative positioning as of last week is at a record bullish, so this is an extra headwind to keep in mind should you be on the bullish side.

I have no "religious" affinity with oil. I try to look at it for what it is, and despite the fact that I think over the long-term oil will be significantly higher, I don't see at this time how oil can remain at these levels. I have seen your previous charts showcasing (rightly so) bullish trades for WTI and energy stocks, but at this stage I would be cautiously bullish. As Bernard Baruch once said, "nobody ever lost money taking a profit."
Cycle wise we are not ready yet. In the 1st stage of the bull market you cannot use fundamentals, dollar strength, indicators. Surprise just come to the upside.
I think oil will have 2 very good weeks now. The bull will kick the bears' teeth out again and again.
Watch what happened to gold. The party just began above the 200 EMA.
chartwatchers chartwatchers
Would you say it will stop strenghen of CAD as well ? Or USDCAD will continue to fall ?
I will check the chart and tell you what I think but most probably : yes.
I think this is the last try of USD to run to a new high and it will fail. After that everybody will realize that the dollar bull is over for a few years...
king24253 chartwatchers
Awesome, thanks very much buddy. Let me know if I should keep my short in USDCAD or not. I believe USDCAD will fall further to 1.19-1.21

I posted a chart this is quite interesting. I would take profit at the beginning of next week.
I think it will break up...
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