USD US Dollar Index Weekly Chart; Overbot; Rising Wedge; Negative Divergence; Upper Band Violation

The consensus keeps calling for a rising dollar along with rising rates. Usually the consensus is wrong. At the start of this year, the Wall Street analysts proclaim that the dollar will crumble into oblivion. They expected the downward-sloping blue channel to continue. At the same time, Keystone highlighted the possie d (green lines) so you knew the dollar was going to bounce not head lower and boooiiiinnngg, it bounces early this year.

USD travels higher into the red rising wedge, a bearish pattern, and hits resistance corresponding to the congestion from late spring early summer 2017 (blue circle). The stochastics are overbot agreeable to a pullback. The RSI lightly tapped overbot territory in early August. The red lines show universal negative divergence across all indicators as the dollar makes new price highs above 97.

Price violated the upper band at 97.58 so a move to the middle band at 95.76, and rising, is on the table. The ADX was in a very strong downtrend in the back half of 2017 into early 2018 (purple box) but this trend petered out by April-May of this year. Note that for the big rally in the USD this year, the ADX is down at 21. The big multi-month rally is NOT a strong trend higher.

Watch the Aroon for the red to cross above the green which signals trouble for the dollar. The neggie d should spank the dollar lower going forward on the weekly basis. This means metals and commodities should feel love as the dollar retreats. Considering the moving averages and price support levels, the 95.7-96.2 range is an initial downside target for the weeks forward. 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.