You can see here that I've been following the progression of the EUR/USD for some time. I have been bullish the dollar, and thus bearish EUR/USD, because I believe that the majority of investors believe the dollar is in for a crash. Anyway, the dollar rally appears to have legs, and I think at a minimum, we'll see the dollar index hit 82 before it would make new lows, it at all.
You can see on this chart (daily candles) that /DX has made the largest counter-trend rally of the entire downtrend. This tells me that the character of trading has changed in the dollar. I believe this new rally is actually the start of an uptrend. It seems that the market corroborates this point of view because you can see that volume has been markedly higher in this rally. Even if we see a downward correction at this point, I would expect the dollar to then make a new trend high. It'll be fun to see what happens!
1 comment:
I don't expect there to be much of a pullback myself.
Given all the reasons for a dollar rally (to which we can add a USD shortage (per ZeroHedge) and Iran invading Iraq to seize an oil well!), I think this is gonna be a 'rip yer face off' rally.
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