USD US Dollar Daily Chart Upward-Sloping Channel

Copper has not participated in the current market rally and the bulls need copper to cooperate to move higher. China's Wen provided a gift this morning pumping the stimulus talk which had traders buying copper.  The asset relationship of dollar down = euro up = copper up = commodities up = equities up played a key role in todays action. The inverse relationship works as well.  Therefore, the behavior of the dollar, and euro, are key and will dictate broad market direction. The 50-day MA at 82.6 is key. Below is a weaker dollar which sends equity markets higher as you saw today. The chart clearly shows how price respects the 50-day MA. 

The dollar slipped under the blue trend line today so tomorrows action is very important. If the dollar is to recover and move higher, back into the upward-sloping channel, above the 50-day, and move higher, it had better make this stick save move tomorrow. Otherwise, the dollar may reexplore the 81.5 level, which would mean equity markets will move much higher. The 81.5 represents the neckline of the longer term H&S pattern, the breakout for the pattern occurring in May with the successful back kiss in June. Simply put, the market bulls need to keep the dollar under 82.6 and heading lower. The bears need to move the dollar above 82.6 and moving higher.  This information is for educational and entertainment purposes only.  Do not invest based on anything you read or view here.  Consult your financial advisor before making any investment decision.