US Dollar Index - DX

[sinner]

Guys,

I have a bad feeling about what is coming!

Not too relevant to this thread but today I exited my longs in EWH and FXI (international) and used the proceeds to long on IAU (ASX) and some more gold.

50 and 100 day MAs have been creamed. As I write this USDX sitting at 80.253 (with last trade at 79.825 and previous close of 77.736), with the 200-day MA beginning a downward turn at high 77s low 78s. Not a lot of room left to feel optimistic.

I can see both sides of the coin in terms of USD bull and bear, but fear the worst. It is worth noting some huge gapping down from 83 to 82 and smaller gaps just above 80, as gaps tend to be filled one way or another, so there is some hope for USD bulls.

 

[sinner]

Just watching Bloomberg right now, they are doing a piece on the USD, the reporter lady is indicating all the traders and analysts she is speaking to TODAY are revising their USD forecast to the downside.

Reasons given lack of a Fed quantitative easy TARGET as well as the fact this years deleveraging is most likely finished up (although would be mindful to consider it will probably begin again next year with the next round of hedge fund redemption calls).

She also mentions there is strong pressure on the Bank of Japan to devalue JPY against the USD, something about everyone needing 100:1 JPY:USD to break even! We will see if they have the power to stop the carry trade unwinding, another Bloomberg article I read on here said BoJ was "powerless" to stop what is happening!

 

[Indie]

Even I'm shorting now....even against the NZD.

 

[BentRod]

just watching Bloomberg right now, they are doing a piece on the USD, the reporter lady is indicating all the traders and analysts she is speaking to TODAY are revising their USD forecast to the downside.

Geez...that makes me want to short some more rather than do anything else.:

 

[BentRod]

Even I'm shorting now....even against the NZD.

Careful, use wide stops/smaller positions at least.

 

[sinner]

Geez...that makes me want to short some more rather than do anything else.:

Hi Bent, like I said I can see it both ways, no decision or choice on my part just trying to bring some info to the table.

 

[bankit]

Hi All,

Peter Schiff's latest episode on the real truth about the USD.

http://au.youtube.com/watch?v=gapZx0bJiRU&feature=related

Bankit

 

[CanOz]

Hey folks, back with a new Laptop, passport and proxy...got kicked off my old proxy...

Those have been some nice moves in the USD pairs lately hey! Watch out for thin markets this week again.

Good Trading.

CanOz

 

[BentRod]

Welcome back Buddy

Hey folks, back with a new Laptop, passport and proxy...got kicked off my old proxy...

Why do you have to use a Proxy?
Is this site on a black list?

Those have been some nice moves in the USD pairs lately hey! Watch out for thin markets this week again.

Some strange moves for Swissie and Euro that is for sure.
Not quite sure what to make of it.

 

[Stormin_Norman]

my feeling is two fold:

lower market liquidity (more price movements).

large players neutralising short positions for the end of year.

 

[CanOz]

Why do you have to use a Proxy?
Is this site on a black list?

Yes it must be on a bad list somewhere. It was fine during the O Games. I use a proxy from Saudi. Sometimes it goes down though.

Great moves in the USD pairs, i'm just getting the stops to even ASAP.

Agree totally with Stormin's comments, thin markets and year end will contribute to this volitility until year end.

Cheers,


CanOz

 

[CanOz]

Looks like the DX might be rolling over now. If the S&P has a good night we could see a big drop.

Cheers,


CanOz

 

[BentRod]

Looks like the DX might be rolling over now. If the S&P has a good night we could see a big drop.

Be interesting to see what happens mate, surely we are due for a bit of short covering anyway???

 

[BentRod]

Hi Bent, like I said I can see it both ways, no decision or choice on my part just trying to bring some info to the table.

Sinner......just looking back at the charts, that Bloomberg story marked the exact bottom...LOL

 

[MARKETWAVES]

Us Dollar

Usd/Chf

Welcome to the " Obama Rally " !

Price-action has been steadily rising
from just before the Inauguration .....
----------------------------------------
2nd Target....... has been reached .......

--------------------------------------------
Elliott Waves Formations at Work
--------------------------------------------

 

[CanOz]

Rolled!

What a night, the S&P rallied as the DX plunged.

CanOz

 

[sinner]

Hi guys,

Let's take a long term look again, charts thanks to fxstreet again.

The first thing to note is a complete lack of the characteristic lack of quiet trendish movements that previously characterised these charts. Traders have been gifted with extreme volatility!

All those participating in the yen carry trade and similar shenanigans are getting chewed out!

Strong resistance at the 0.88 price level means we have not seen a reversal of the long term trend yet (still a lower high). But the stochastic has bottomed and turned nicely while the MACD has turned up for another possible crossover of the trigger, with the price gaining good support from the 100MA (higher low).

The bullish divergence I was looking for was resistance from the 200EMA after the price broke down through it, but it was sliced through with a bearish bounce off the 100EMA.

So the picture is there for a possible long term trend reversal, as others here have posited is their opinion already. Looking for a higher high (90 looks like a possibility on the now widened boll band), stochastic to remain above 0.2, MACD to remain above 1.5 (with an eye to the trigger) and for a further reduction to risk the 200MA should stop trending down. We saw a tiny bit of this after it bounced off 0.82, and it needs to continue now.

Frankly a small retracement to 0.82 followed by a bounce to the top of the boll band looks more likely than a drop to 0.78 from here!

This is why I think it is very important to examine the long term chart, sometimes these technical indicators can provide insight the fundamental situation. Imagine if you had longed the bottoming MACD crossover in late 2007 at 0.71!!!

 

[CanOz]

Great post on the bigger picture Sinner, thanks for the longer term charts.

CanOz

 

[acetrader]

I thought i would start this thread to help some of us newer FX traders identify trend changes/continuation patterns in the major currency.

To me, this is another pivotal moment in the DX which could define the trend for the next few weeks, even months with the passing of the bailout package. The USD could come under pressure now. Technically the chart looks oversold and depending on what happens next week we could be seeing some bearish divergence.

Anyone care to comment on the direction of the USD in order to help us take a view on the markets for coming week?

Cheers,
CanOz

Usually i have to force myself not to have any opinion about the market especially about its direction. After years of try and trial I find only one true opinion that is the market itself. When you scroll through the stock chart, it looks like a painting roll, it seems somthing had happend and waiting for our viewing, but it is just an illusion. If you are an analyst you have to have some opinions and give to your clients that is you paid for. But as a trader you have little advantage. you don't have to have opinion. You just prepare your plan A and plan B and plan C and know when to switch. So I believe the liquid market is just like giant river. it goes where it likes to go we just need to find a way to enjoy the ride.
Good Luck!

 

[CanOz]

Usually i have to force myself not to have any opinion about the market especially about its direction. After years of try and trial I find only one true opinion that is the market itself. When you scroll through the stock chart, it looks like a painting roll, it seems somthing had happend and waiting for our viewing, but it is just an illusion. If you are an analyst you have to have some opinions and give to your clients that is you paid for. But as a trader you have little advantage. you don't have to have opinion. You just prepare your plan A and plan B and plan C and know when to switch. So I believe the liquid market is just like giant river. it goes where it likes to go we just need to find a way to enjoy the ride.
Good Luck!

Nice analogy Ace. Generally i try to anticipate moves in all three directions (up, down and sideways) but its good to have an eye on the bigger trend, to keep it in the back of your mind, IMO.

The DX for example, when it was at the trend line, i was alert for a potential trend change on the other pairs. Some of the other pairs had no support/resistance that was obvious, the DX can provide an idea where trends may stall, or resume.

Cheers,


CanOz