Nov
18

Currency Overview

usdupx_004

Everything feels bullish, but I still have my eye on that Dollar chart. I’m long like everyone else, but I am looking to pull the plug once the market makes its final push and the Dollar finds intermediate term support at the 2008 lows. Assuming the Dollar does find support, it doesn’t mean we’ll get an Xtrends crash, but it does remove the catalyst that has been pushing the market higher. I don’t want to be heavily invested to the long side when the catalyst is removed. It looks to me that this might get resolved around Thanksgiving.

 

fxe

I continue to watch EURUSD very closely too. FXE keeps flirting with $150 but hasn’t been able to take it out. It is now hanging in there over the 50-day SMA. FXE will be resolving soon and we’ll then have our answer on market direction.

fxf

All of the major currency pairs have generally showed strength against the Dollar. I think it is worth watching the components of the Dollar indexes to try to get a feel on where the index is going. FXF looks similar to FXE and is flirting with its 50 day.

fxc

FXC is also sitting on its 50-day. I’m looking for changes in direction of any of the major currency pairs as a guide. I continue to not differentiate various sectors of the stock market and to look at equities as a single class right now. In my opinion, almost everything is highly correlated and really just lower or higher beta bets on the direction of the Dollar.

 

es_024

Overnight range of 1105-1110.

RedditFacebookStumbleuponDiggDel.icio.us Posted by Charts and Coffee Uncategorized Subscribe to RSS feed
  • stephenberry
    Interesting blog. I don't believe in destiny, however, or inevitable epic C-waves. I'm not "long" on anything except skepticism. I don't believe markets "know" or "feel" anything. I think attempting "to time" the market is a little like taking side bets on the ramblings of a schizophrenic off his medication. Continued "quantitative easing" by the world's central banks appear to be ensuring the dollar's continued decline. I don't see that changing anytime soon. What I do sense is that, compared with last week, your confidence in the dollar "approaching support" has waned just a wee bit, no?
  • No, I still feel the same as I did last week. We're in the immediate term upside phase as the dollar approaches support. I do try to stay open to all possibilities which is why perhaps I come across as backing off last week's post. I'm not. I think the dollar trades sideways or corrects to the upside. Sideways may not be bad for the market but I don't want to be long with that catalyst off the table. I would be shocked if it just cuts right through 2008 support.
blog comments powered by Disqus
Disclaimer: This blog does not and is not intended to provide financial advice of any kind. Any commentary used on this page is for purposes of discussion only. You should not construe anything on Charts and Coffee as recommendations to buy or sell securities and you should not construe anything on this page as legal, tax, investment, financial or any other type of advice. Nothing contained on this page constitutes a solicitation, recommendation, promotion, endorsement, encouragement or offer to buy or sell (whether it is securities or otherwise) by Charts and Coffee, its owners, representatives or agents.