In the middle of October I suggested to short the dollar in this post: Unfortunatley didn't have time for an idea to post. A few days ago I closed the short positions , and now I think it's very possible the dollar will print a rally in the following days.
The FED's rate hiking cycle pushed the dollar above 114 in the summer, but in October the market started to price the end of the aggressive rate hiking cycle... The dollar collapsed in a few weeks breaking every level almost without stops. At 101 finally we found a support. 101 was the bottom of the 2022.05.30.correction : and this is also the 50% FIB retracement of this 2-year-rally.
The chart is not giving too much sign of a reversal yet, only MACD is showing divergence, and trying to cross over. Ahead of the next week FED meeting I think we a have good chance for a dollar rally.
Comment
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We have an important daily data today which will affect gold and dollar prices. the US core PCE index was at 4.7% in November and is expected to decline to 4.4% in December. I think the data will be 4.2-4.3% what clearly shows that the Federal Reserve’s aggressive monetary policy has effectively decreased inflation.
I've seen assets dump through.618s like it was a .236. Bottom line is sp500 already bottomed and partial returned with confirmation breakout ALL above 200 weekly ma. You've been front-ran congratulations. First time? Where I live we like high prices hint hint. And this compartmetalized covid induced recession has grown boring to the uber rich with the 9trillion burning a hole in their pockets. Bitcoin being accumulated for 200 days wasnt the clue?
@chartwatchers, haha! This spy balloon rally was pretty violent... Hope you raked it in$$. Time to continue the inverse-homeless risk rally now...
aksjetom
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I have been looking at EUR/USD... There is something going on with the USD. For some reason I read it as if EUR going to strengthen against USD. Wondering if there will be a catalyst when DXY has reached its peak
LowestLows
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Agreed. How are you expressing this view? Shorting risk? What is/are you DXY targets? Are you looking for a small correction and continuation of downtrend or do you view this as a pullback in a major DXY uptrend. Thanks
aksjetom
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@LowestLows, DXY up basically is the same as Gold/BTC down. Or, US stock market down, could/should equal DXY up hypothetically.