USD DXY US Dollar Weekly Chart; Oversold; Falling Wedge; Positive Divergence; Lower Band Violation

The US dollar is going to be fun to watch. The weekly chart is set up with oversold conditions, a falling wedge and positive divergence which all say a rocket launch higher is on tap. How can that be?! Blasphemy! Blasphemy I say! Recant! Recant such dribble! 99% of Wall Street is short the dollar so by decree it will not go up and can only go down. Imagine the surprising look that will appear on the dollar shorts faces when the dollar begins ramping higher. The short covering fuel will send the dollar skyward tanking the US stock market a March redux.

The lower standard deviation band is violated so the middle band, the 20-week MA, at 93.08, is on the table and the upper band at 94.71. Once the dollar begins rocking and rolling higher, the flat-moving moving averages will likely become targets. No one is ready for it.

President Lagarde will be conducting the ECB meeting on Thursday, 12/10/20, so the temperature in the room is heating up. Currency traders will be making moves in the days ahead. Will the dollar shorts panic? Europe cannot sustain an ever-increasing euro. Germany is Europe's economic engine; exports are its life's blood. A lower currency helps that countries manufacturing and export industries.

Keystone is not playing the dollar now but has been in on the long side for a couple bounces. The dollar should only be played long. Go against the crowd. Sure, Madame Lagarde may shun stimulus and the euro may float higher further slapping the dollar but the possie d forces in the chart will simply set up again or remain in play. Once the dollar catches a bid, it may never look back. The rally should last a few weeks. The US dollar is at 91.39 slipping away from that key 92 level on this hump day morning. 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.

Note Added 9:00 AM EST: US dollar 91.33. LOD 91.11. Euro 1.20+. S&P futures -11. VIX 21.11. SPX 3662 (all-time record closing high on 12/1/20). 

Note Added 4:23 PM EST: US dollar is at 91.07 at the LOD at 91.07. The dollar is in the fight of its life holding on by a fingernail while all of Wall Street is trying to pull the buck lower. The euro leaps to 1.21 and spurts above but retreats back below to 1.2080. Higher euro means lower dollar. Germany winces each time the euro pops higher. There is drama in currency land. The softness in the dollar provides lift to stocks with the SPX up 7 points, +0.2%, to a new all-time record closing high at 3669.01 on 12/2/20 but not a new all-time high. HOD 3670.96.. ECB President Lagarde drops her blue blazer off at the dry cleaners in preparation for next Thursday's press conference and rate decision. They have to remove a grape jelly stain on the lapel that occurred during the free buffet before the last meeting. Currencies will be key in the days ahead. US dollar is down to 91.05. Is this the Night They Drove Old Dixie Down? . 

Note Added 4:50 PM EST: US dollar loses the 91 level to 90.99. The euro is at 1.2115 printing high at 1.2118.

Note Added Thursday Morning 12/3/20, at 4:17 AM EST: US dollar is at 90.99 after dropping to a low at 90.84. Price is back-kissing the 91 S/R for the last six hours. The buck is deciding to bounce or die from 91. What say you greenback? Euro 1.2109.

Note Added Thursday Evening, 12/3/20, at 6:53 PM EST: The SPX prints a new all-time high at 3682.73 but then drops to 3658, then finishes the day at 3666, on news at 3:31 PM EST that Pfizer will not meet its vaccine distribution goals this month. Euro 1.2146. US dollar index 90.70. Gold 1844. 10-year yield 0.91%.