The sideways symmetrical triangle is in play and manifests due to the sideways nature of the dollar for the last half year. Yesterday the dollar tapped on the upper rail of the triangle and retreated to close just below at 80.19. The vertical side of the triangle, thick blue line, is 3 bucks height, thus, if the dollar bulls win, and price breaks up and out of the triangle at 80.3, the target is 83.3. If the dollar bears and equity bulls can fight back and push the dollar down to fall out the bottom of the triangle at 79.50, that targets 76.50 on the downside. The 78.50-ish level is strong long-term support so failure of 78.50 means serious trouble for the dollar, however, the stock market would fly higher.
The dollar, and euro, may choose to continue a sideways path forward but a move above the 80.30 triangle top rail, and the light blue line that shows overhead resistance in this same area, would indicate a breakout for the dollar to the upside and equity markets would be selling off. The indicators are long and strong (green lines) over the last few days so even if the dollar pulls back today it will want to make another higher high early next week. 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.
As central bankers tinker with the world economies in an effort to fix things a lot is going to get broken in their paths as 2013 I’m certain will be a year where the forex markets will be the proverbial head that wags the tail. I’m woefully underprepared in my research to capitalize on such moves as of yet as evidenced by seeing your chart here on the dollar. I know what it means and if what I think is going to happen happens the initial break to the downside as I have seen in decades past is the” false break” is generally followed by a voluminous break of the upper rail implying a protracted move to the upside and so goes all that must come to pass pursuant to inter-market relationship as per a high dollar. We all could stand to make extraordinary returns as inter-market relationships fall into place by understanding the eminent moves that are about to unfold in the currency markets this year.
ReplyDelete