• 723 days Will The ECB Continue To Hike Rates?
  • 724 days Forbes: Aramco Remains Largest Company In The Middle East
  • 725 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 1,125 days Could Crypto Overtake Traditional Investment?
  • 1,130 days Americans Still Quitting Jobs At Record Pace
  • 1,132 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 1,135 days Is The Dollar Too Strong?
  • 1,135 days Big Tech Disappoints Investors on Earnings Calls
  • 1,136 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 1,138 days China Is Quietly Trying To Distance Itself From Russia
  • 1,138 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 1,142 days Crypto Investors Won Big In 2021
  • 1,142 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 1,143 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 1,145 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 1,146 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 1,149 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 1,150 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 1,150 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 1,152 days Are NFTs About To Take Over Gaming?
How The Ultra-Wealthy Are Using Art To Dodge Taxes

How The Ultra-Wealthy Are Using Art To Dodge Taxes

More freeports open around the…

What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

Is The Bull Market On Its Last Legs?

Is The Bull Market On Its Last Legs?

This aging bull market may…

  1. Home
  2. Markets
  3. Other

Dollar Technicals

Figure 1 is a weekly chart of the US Dollar Index (symbol: $DXY). The pink labeled price bars within the ovals are positive divergence bars.

Figure 1. $DXY/ weekly

The US Dollar Index remains in a downtrend. However, a weekly close above 76.58, which is the high of the recent positive divergence bar, would nullify that down trend, and in all likelihood, the Dollar Index would trade in a range. A close above the pivot at 79.46 would turn the down trend into an uptrend.

Some of the prior articles on the Dollar Index, which explain some of the strategies that use to arrive at these conclusions, are located here:

The Technical Take: Very Dangerous Time For Dollar Index (Jun 19, 2009)
The Dollar Index: The Trend Is Your Friend (September 18, 2009)
The Technical Take: This Time Is Different (In Reverse) (August 21, 2009)

While the technicals from my perspective are pretty straightforward, the question remains what impact will a higher Dollar have on equities and commodities. The common assumption is that a higher dollar can only mean one thing: a flight to quality as the reflation or risk trade is over. I am not sure that is going to be the case here. Equities do look weak as many sectors have been breaking down over the past month, but gold and crude oil still look very strong despite the recent market turbulence. So if we do get that higher Dollar, it will be interesting to see how the commodities react versus equities.

 

Back to homepage

Leave a comment

Leave a comment