Category: US Dollar Index

The US Dollar Index $DXY_us.

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Dollar retreats, gold rises

The US Dollar Index is retracing to test support at 76.00. Respect of support would confirm the primary up-trend and offer a target of 84.00* for the next advance. A 63-day Twiggs Momentum trough above zero would strengthen the signal.

US Dollar Index

* Target calculation: 80 + ( 80 – 76 ) = 84

Spot gold is testing the declining trendline and resistance at $1700/ounce. Respect would warn of a decline to test $1500*. The primary trend remains upward and will resume if the Fed introduces further quantitative easing in the months ahead.

Spot Gold

* Target calculation: 1700 – ( 1900 – 1700 ) = 1500

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Dollar fall lifts gold

The US Dollar Index broke out of its trend channel, warning of a correction back to 76 on the daily chart. Respect of 76 — or 63-day Twiggs Momentum respect of the zero line — would confirm the primary up-trend and offer a target of 84*.

Dollar Index

* Target calculation: 80 + ( 80 – 76 ) = 84

Spot gold rallied as the dollar weakened and is testing its descending trendline and resistance at $1700/ounce. Respect would signal a decline to $1500*, while upward breakout would indicate that the correction has weakened but not necessarily ended.

Spot Gold

* Target calculation: 1700 – ( 1900 – 1700 ) = 1500

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Dollar Index reaches target

The strong advance on the US Dollar Index continues. Now that the index has reached its current target of 79, expect retracement to test the new support level at 76. Respect of support would confirm the primary up-trend and offer a target of 84* for the next advance. A trough above zero on 63-day Momentum would strengthen the signal.

US Dollar Index

* Target calculation: 80 + ( 80 – 76 ) = 84

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Dollar rise as euro falls

The euro is testing short-term support against the greenback at $1.35/1.34. 63-Day Momentum (declining below zero) reminds we are in a primary down-trend. Failure of support would signal a decline to $1.30*.

EURUSD

* Target calculation: 1.40 – ( 1.50 – 1.40 ) = 1.30

The dollar has benefited from safe haven demand, commencing a primary advance as the euro falls. 63-Day Twiggs Momentum crossed to above zero, confirming the primary up-trend. Further retracement to test the new support level at 76.00 is likely, but respect would demonstrate strong buying support.

US Dollar Index

* Target calculation: 76 + ( 76 – 73 ) = 79

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Dollar surges as Fed nixes QE3

The US Dollar Index surged after the latest FOMC statement avoided any mention of additional purchases of Treasuries or mortgage-backed securities (MBS). Though they did leave the door ajar with their concluding paragraph:

………The Committee discussed the range of policy tools available to promote a stronger economic recovery in a context of price stability. It will continue to assess the economic outlook in light of incoming information and is prepared to employ its tools as appropriate.

The index respected the new support level at 76.00, confirming a primary advance to 79* — the start of a primary up-trend. 63-Day Twiggs Momentum crossed to above zero, further strengthening the primary trend signal; a large trough that respects the zero line would provide final confirmation.

US Dollar Index $DXY

* Target calculation: 76 + ( 76 – 73 ) = 79

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The Next Selling Wave Is About to Begin | Toby Connor | Safehaven.com

As the stock market moves down into the next daily cycle low and the selling pressure intensifies, this should drive the dollar index much higher. It remains to be seen if gold can reverse this pattern of weakness in the face of dollar strength, especially since the dollar will almost certainly be rallying violently during the intense selling pressure that is coming in the stock market.

via The Next Selling Wave Is About to Begin | Toby Connor | Safehaven.com.

 

When the dollar strengthens, gold normally falls. Except in times of high uncertainty (like the present), when demand for gold as a safe haven overcomes downward pressure from a stronger dollar. Buying gold at current prices is a bet that either Greece will default — a pretty safe bet — or that the Fed is again forced to use its printing press (not quite as certain).

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Dollar tests new support level

The weekly chart of the US Dollar Index ($DXY) shows retracement to test the new support level at 76.00 after the recent breakout. Respect of support would confirm the breakout and reversal to a primary up-trend. Failure would warn of a bear trap. Reversal of 63-day Momentum below zero would also indicate continuation of the primary down-trend. A lot depends on the outcome of this week’s FOMC meeting.

US Dollar index

* Target calculation: 76 + ( 76 – 73 ) = 79

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Strengthening Dollar

The falling euro strengthens the US Dollar Index which broke through resistance at 76.00. Breakout completes the base which has been forming over the past 5 months. Retracement is likely; and respect of the new support level at 76.00 would confirm a primary up-trend, while failure would warn of a bull trap.

US Dollar Index $DXY

* Target calculation: 76 + ( 76 – 73 ) = 79

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Dollar rallies

The Dollar Index rallied strongly but expect stubborn resistance between 76.00 and 76.50. Consolidation between 73.00 and 76.50 has continued for more than four months, but we are in a bear trend and downward breakout remains likely. Failure of support at 73.00 would offer a target of 70.00*. Any hint of quantitative easing in the next FOMC announcement, on September 21st,  would accelerate the sell-off.

Dollar Index

* Target calculation: 73 – ( 76 – 73 ) = 70

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Dollar Index threatens support

The Dollar Index continues to test the band of support at 73.00 to 73.50. The recent failed up-swing (it did not reach 76.00) suggests selling pressure. 63-Day Twiggs Momentum oscillating below zero indicates a strong down-trend. Breakout below 73.00 would offer a medium-term target of 70.00*.

Dollar Index

* Target calculation: 73 – ( 76 – 73 ) = 70

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