Dollar decline nearing an end?

G

gharghur2

The Dollar appears ready to embark upon the next leg of its bull market. In Objective Elliott Wave terms the Dollar has been in a bull market since late 2004 when it bottomed at 80.40. During the upward trend, a five advance advance unfolded as the Dollar rallied to 92.60. Since that high in November 2005, the Dollar has been correcting in what appears to be a flat: an established low that is retested. Today that low was successfully tested!

In the past, every time the Dollar has corrected the 5-week RSI has touched the oversold 30 level: during wave 2, wave 4, wave a and now wave c. With the MACD at neutral it appears to be at a good momentum setting to launch the next leg up of its bull market.
 
Reviewing the daily chart, at the current lows the Dollar is oversold in both RSI and MACD and setting up positive divergences. Once the Dollar clears 89.80 it should be well on its way in the first leg up of this next five wave intermediate term advance. Looks like the greenback is readying to resume its bull market!
 
It is widely said that dollar index is going to around 70 and today even IMF recommeded further depreciation of the USD. I am no currency buff, but fundamentals on dollar look weak, especially when yesterday Fed announced that they might have gotten done with interest rate hikes for a while.
 
Quote from gharghur2:

Reposting the charts
More...

Tony -

I think the world of ya, because I think that you were just so dead on on the whole long bond thing, but I disagree with you here on the EUR/USD.

Seems to me that we may have a significant H&S forming on the weekly chart.

While it is probably a foregone conclusion that there will be continued US rate raises, I think they will be viewed as a defense of the USD and a means to slow the decline, rather than a means to arrest or reverse it. I just can't be long USD right now. Maybe I would change my mind at a convincing few closes below 1.16, but until then no sale.
 

Attachments

Quote from just21:

The rest of the world thinks it's going down but I guess the crowd is always wrong!
More...

Hi Just!

I've been patiently waiting for this retest of the lows since the last rally failed. The positive divergence on the RSI makes me feel even more positive. It's dangerous buying right into a selloff, but then again that's how bottoms are made. We'll see!

thx
 
Quote from toc:

It is widely said that dollar index is going to around 70 and today even IMF recommeded further depreciation of the USD. I am no currency buff, but fundamentals on dollar look weak, especially when yesterday Fed announced that they might have gotten done with interest rate hikes for a while.
More...

Hi Toc,

It's possible it could go lower. But I'm satisified with the technicals at the moment. I may be early. But it is a bull market. Seventy is way out of the question. We could see 86 if this flat doesn't hold.

thx
 
Quote from drsteph:

Tony -

I think the world of ya, because I think that you were just so dead on on the whole long bond thing, but I disagree with you here on the EUR/USD.

Seems to me that we may have a significant H&S forming on the weekly chart.

While it is probably a foregone conclusion that there will be continued US rate raises, I think they will be viewed as a defense of the USD and a means to slow the decline, rather than a means to arrest or reverse it. I just can't be long USD right now. Maybe I would change my mind at a convincing few closes below 1.16, but until then no sale.
More...

Hi Doc,

Thank you for those kind words. You know you are right there is a head and shoulders top. I might be early. Eighty-six might be a better entry point if todays low don't hold.

tony
 
You must log in or register to reply here.
Back
Top