In a post last week we noted that Uncle Buck was dropping into a zone of long-term support. This morning there is this strange looking color in market futures, ranging from stocks to commodities to precious metals as the dollar bounces a bit from the noted support zone. So far it’s not much of anything, but if a bounce gets going (we’ve been noting in NFTRH that it could come at any time now that support has been hit) I’ve drawn in the two applicable resistance areas.
Short-term resistance is its own little stand-alone cluster. But the resistance in the 91s coincides with major resistance from the topping structure. If you check the link above to last week’s post you’ll see what I mean.
The bottom line as it looks now is that if USD bounces, it had better not get through S/T resistance or else it is going to bring some pain to the various ‘inflation trades’. If it bounces and gets halted at S/T resistance then it’ll likely be a blip and shakeout, but then ‘as you were, party goers… ‘.
If the technically bearish buck bounces to the upper resistance area US stocks would not likely get the Goldilocks bid this time. Check out this chart from NFTRH 484. I used this chart in the Market Internals segment to show that it is the ultimate internal underpinning to the market during the Trump era fiscal reflation.
It is also worth noting again that we’ve recently introduced Uncle Buck as a candidate for 4th Horseman (vying with the Gold/Silver ratio) to come into play after the happy-go-lucky Amigos reach their destinations or abort mission.
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