When I see funny things from chartists in the greater media, I’ll make fun of them here. But I will do so as a man who stares at charts and is sometimes wrong in my conclusions. Hence, I am not above the fun. This morning I stare at USD daily, weekly and monthly charts (real time as of just before this post, courtesy of Investing.com) and see patterns to which I ascribe some sort of import. :-)
This morning USD daily is flirting with a breakout line of sorts to a bullish looking pattern. This after holding the 50 day moving average. A more important breakout objective would be July high above 96.90. I don’t call the pattern an Inverted Head & Shoulders because it was not preceded by a downtrend. But it could be a continuation pattern of some sort. It would target 98+.
USD weekly chart shows more clearly a point of resistance at the July high and also the lows from mid-2017. More importantly, Uncle Buck is back to his old tricks in putting a weekly Inverted H&S back in play. The neckline resistance (and activation point) is the red line. Interesting how the objective of the little pattern above is slightly higher than the neckline below.
And the monthly chart reminds us that the USD rally did come from valid long-term support and that the “dollar collapse” fetish in some corners is not grounded in TA. It also instructs that if the H&S above were to successfully break out USD would be going back to the 2016-2017 highs, or higher.
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