I'll mark myself down as long more as a technicality then a true conviction. In my opinion the charting suggest this is bullish, but I like to interpret our break through the multi-decade wedge resistance as a critical point (yet to indicate a particular direction). Despite every suit on CNBC calling the fall of the dollar, I would argue on a historical basis were at a relatively low point (especially if you were to consider the dollar index in gold denominated terms, go chart "dxy/gc1!"). Given these circumstances and an apparently bullish break, Regan and Bush dollar values don't seem too far away.Perhaps mullets will have their comeback too. Ive outlined a smaller falling wedge to give some context as to timing, which would confirm a successful third attempt to break resistance as a catalyst for a rally.
I expect us to continue beyond this point into the high 90's before consolidating, and perhaps retesting the old resistance. Should the old resistance hold as support I would comfortably by into your favorite Dollar ETF. Should it re-enter the wedge pattern I would expect a rather quick fall to mid 80's, hammering out a bottom and completing a second leg of a wave theory retracement.
Nominal measured move of $78 takes us to $170, percentage measured move of 48% takes us to $140. First pit stop is at $118, the most recent high in 2001 and would definitely be my limit sell if it managed to get there. Let's see which way it goes and consider it's affect on gold and exporter stocks.
I agree and that is a mega move for the dollar if it happens. My take is that such a move will be on shale oil and gas continuing to increase in production relentlessly ad this is possible until 2018-2020 according to the EIA low and medium cases.
If shale takes a big knock on credit issues and the low price of oil, maybe this might interrupt the dollar's rally and the tedious gold bear market but if it resumes, my bet would be the dollar takes another leg up.
1000gold.blogspot.co.uk/2015/02/essay-on-gold-comparing-current.html
TinPusherL30
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I like your analysis; however, I think you miss on one important factor in the weakness of the dollar! This would be the printing of all the fake Monopoly $ in circulation, this amounts to and is equivalent to a bio stock having numerous offerings & diluting the value! The more shares out their, the weaker it is. That's it, cheers!
fxswing
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Not sure what the scale you're using for that DXY chart, but to me the monthly trendline breakout happened in Oct/Nov 2014 above 87...
That trendline on your chart seems quite misleading imho
BeardTech
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The scaling is logarithmic, which I typically use when dealing with a chart that is long term and spans a large range of prices. So in this case I found log to be more indicative of the price trend ahead. Hope that helps.
Technician
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Truly a very critical area we are trading in..
Technician
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That brings to my attention a euro below parity again
DaveBellamy
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The Euro was below parit with the US dollar index at 121 in 2001 if I recall correcly. A move i nthedollar to 160 would have the Euro at about 60 US cents and the pound at $1.10 or so!
If shale takes a big knock on credit issues and the low price of oil, maybe this might interrupt the dollar's rally and the tedious gold bear market but if it resumes, my bet would be the dollar takes another leg up.
1000gold.blogspot.co.uk/2015/02/essay-on-gold-comparing-current.html