YaKa
Long

USD Index - The end of the road could be higher

INDEX:DXY   US DOLLAR CURRENCY INDEX
307 6 3

Just mapping things, i find that after a congestion in the current area which is resistance, the USD may carry on higher...

108 could be that target over 1 year.

Better try to hook to that trend then try to spot where it corrects...
113
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Yacine, I'm reading between the lines that once Dollar goes up, commodities will go down, and we'll be able to trade them more effectively predicting Dollar behavior.

But, are you able to find any persistent correlation between Dollar and some commodity behavior?
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There is always a correlation between two things trending.... the causality is not certain though....
Here, commodities were already trending down for a while.. USD strength is only adding to the reasons why... not causing it for sure.
+1 Reply
dp YaKa
If I'm looking at the history of, say, XAUUSD and DXY correlation, I'm pretty sure I can find periods of time when:

1. On is up-trending, another down-trending and vise versa (negative correlation)
2. Both are up-trending, or down-trending (positive correlation)

What is the predictive value of such analysis?
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you seem to have the answers to your questions.

The USD strength is one important component of the equation.

Correlations change over time and do not mean the same things over time
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Excellent.
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