The USD has strength - The currency for long-term liquidity
The USD has shown and is showing a lot of strength in the markets over the last 12-16 months while the economy maintains growing risk of a global correction/systemic collapse. The USD is decorrelated from the Euro, Pound Sterling or Swiss Franc, to name a few of the suffering European currencies, having lost over 20% of its value in the last 12-16 months, without counting inflationary costs. In other words, holding long-term bearish currencies is not smart for any company, government, or institutional fund, without worrying about short-term fluctuations.
We never know the future nor should we aspire to know it too accurately, but, from a quantitative trend-following perspective and applying the right risk and wealth management tools, most companies' cash and our cash will be safer in USD than in their uncorrelated currencies in the coming months/years.
I am moving at least 60% of my fiat liquidity into USD, regardless of short term volatilities, because the fundamentals, economic and technicals are on our side.
Take a look at that +75 RSI on the monthly chart, which shows a fairly strong and consolidating trend, as well as the MACD in clear uptrend.
I expect the USD to correct in the short term and touch the 0.95 support/resistance that has been active for over 10 years, but for long term cash management, if you are not leveraged, I would not believe in any currency other than the international one.
Strategy (spot cash, unleveraged):
- Entry: anytime above 0.95.
- Stop Losses: None. We are managing liquid cash from our funds.
- Take Profit: None. We are managing cash.
- Hedging: We could hedge the EURUSD currency pair at a DMA, A book OTC brokerage firm such as IG, Saxo, or CMC, or with futures/options, but it is not of my interest at this time.
We never know the future nor should we aspire to know it too accurately, but, from a quantitative trend-following perspective and applying the right risk and wealth management tools, most companies' cash and our cash will be safer in USD than in their uncorrelated currencies in the coming months/years.
I am moving at least 60% of my fiat liquidity into USD, regardless of short term volatilities, because the fundamentals, economic and technicals are on our side.
Take a look at that +75 RSI on the monthly chart, which shows a fairly strong and consolidating trend, as well as the MACD in clear uptrend.
I expect the USD to correct in the short term and touch the 0.95 support/resistance that has been active for over 10 years, but for long term cash management, if you are not leveraged, I would not believe in any currency other than the international one.
Strategy (spot cash, unleveraged):
- Entry: anytime above 0.95.
- Stop Losses: None. We are managing liquid cash from our funds.
- Take Profit: None. We are managing cash.
- Hedging: We could hedge the EURUSD currency pair at a DMA, A book OTC brokerage firm such as IG, Saxo, or CMC, or with futures/options, but it is not of my interest at this time.
