Mostly publishing to track the development. Analysis:
ES/DXY topped out and formed a wedge on the way down.
Expecting this to retest either the .5 or .382 fibs, before taking off. Otherwise, it completes the inverse head and shoulders and goes off from here.
This is interesting, because if this plays out, there are two likely options:
1. The recent DXY breakout was a bull trap, and it is about to go significantly lower. The rate of drop for DXY > SPX, to allow it to take off.
2. The SPX is creating a bear trap and will aim for new aths. Depending on the dxy's move, if it crashes or trades sideways for a prolonged period of time, then gold, silver, bitcoin and other commodities come back into play until year end, before a possible liquidity crunch due to lingering econ. weakness after covid.
The final alternative, is that the DXY trades sideways, but the USD itself trades weaker. Shitty currencies propping up the DXY, but the USD getting weaker vs good currencies (e.g. euro, yen). That would build a bullish case for equities, in the "starving for yield" sense.
One thing is certain this is all getting interesting.
Previous idea:
ES/DXY topped out and formed a wedge on the way down.
Expecting this to retest either the .5 or .382 fibs, before taking off. Otherwise, it completes the inverse head and shoulders and goes off from here.
This is interesting, because if this plays out, there are two likely options:
1. The recent DXY breakout was a bull trap, and it is about to go significantly lower. The rate of drop for DXY > SPX, to allow it to take off.
2. The SPX is creating a bear trap and will aim for new aths. Depending on the dxy's move, if it crashes or trades sideways for a prolonged period of time, then gold, silver, bitcoin and other commodities come back into play until year end, before a possible liquidity crunch due to lingering econ. weakness after covid.
The final alternative, is that the DXY trades sideways, but the USD itself trades weaker. Shitty currencies propping up the DXY, but the USD getting weaker vs good currencies (e.g. euro, yen). That would build a bullish case for equities, in the "starving for yield" sense.
One thing is certain this is all getting interesting.
Previous idea:
