Who is watching the weekly chart of the dollar could not miss the tag of the 200 SMA. The institutional buyers of the dollar were ready at this level and it reversed. Was this drop enough severe? If you take a look on the RSI, MACD, SLowStoch you must notice that this is the level where the previous bottoms formed (red dotted line). Now the question is how far this correction will go? Though I'm long in the USD it's important to keep in mind that I think the longer term trend is bearish. I still think we are still in the megaphone pattern. So even if we get a very convincing bounce we have to be ready that it's going to drop hard again.
I'm 100% sure we will tag the 10EMA on the weekly chart. Most probably we will see a tag of the 20 EMA and maybe the 50 EMA. This bounce will affect every vehicle in forex , the stock market, and precious metals. So needed to watch very closely.
During the next few weeks we might be printing a giant H&S pattern
Arpi, In a cycle,I want to figure out why one correction does not move the price much, but following correction effect the price very much..... any idea on that. Thanks
lantao517
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wait for PPI & CPI data on Thur and Fri.... I put money beside and wait
lantao517
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Yesterday Germany important factory data was unexpected so weak, again market choose to ignore, Euro bullish players will pay for it quite soon...
This week US will release PPI & CPI data, which is so important right now, 90% investors hold bear view on US inflation although strong than expected employment&payroll. As oil price and industrial metals picked up significantly by over 15% during since late June, I believe PPI&CPI this week will surpass most expectation high.
Headwind for Gold and EM currency is coming.
bhsencer
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DXY seems to show pattern again.... soon it will push higher hopefully .............
bhsencer
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@bhsencer, I am expecting the DXY enter a correction (not cyclic) you can just wait storm to pass. I am not happy with DXY's performance and (5) wave is short again and hammered, it look in couple hours it can start correction. This correction will realy show if DXY bounce strong or If DXY will lose all gains. I am long by the way.
bhsencer
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@bhsencer, since i print the graph above I follow with update. DXY did very good start and now again start loosing wave formation. We have one more leg up with wave 5 and then it will enter cyclic correction. DXY did very deep correction with wave 4 so I am not seeing very good upside. Lets see what happens with 5 wave.
bhsencer
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@bhsencer, it seems we are going to have a final correction after completing 5th wave in couple ours. DXY quit forming waves, bounce is not strong, DXY seems side lining.