US dollar index (DXY) frisky ahead of next week’s FOMC nothingburger, I mean meeting
We projected a bounce for USD nearly a month ago in this now public NFTRH+ update.
In a subsequent and still password protected video update the following was noted…
“The very key here is 104.30, or the December high. Take that out and the correction is busted for the dollar and something else is going on.”
Today the US Dollar index (DXY) is pushing extremes, as markets so often do. It is popping through resistance and the SMA 200, just to get TAs and the machines alike riled up. With the recent jawboning by Fed orifices in the media * and recent still-firm economic data (employment and consumer) Uncle Buck has really got a good bounce in his step. But the lower high is intact and I wonder if an FOMC contrary flashpoint and/or any near-term economic data may bring a halt to the bounce.
Conversely, if USD unexpectedly takes out the December high, “something else is going on”. But right now, it’s bounce baby, bounce! And nothing more. All as originally anticipated.
On a cautionary note, long-term charts show justification for the support lines drawn on the daily chart above. And that justification is solid. Also, USD has thus far made a higher high to the March high and thus far held a higher low to the July low. So USD could well end its correction by those measures.
Oh, and there’s this to consider as well. The Gold/Silver ratio led USD’s bounce and it remains elevated. If both of these were to get out of the barn and rise impulsively, something else assuredly would be going on here. And that, to quote the hilarious Seinfeld ‘bad chicken’ episode, “is not gonna be good for anybody”.
* And how annoying is it that these creeps feel the need to get in the media so regularly, over-killing us constantly with bald faced perceptions management?
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Gary, I give you credit for being able to handle this stuff professionally. Part of me looks at this Goldilocks era and feels good for people like my daughter who’s been working for a year or so and faithfully maxing out her 401k and putting it into an S&P 500 fund. At some point things will drop, and I will be interested in her reaction.
The other part is just so darn frustrated at all the hype. New record! Next day. New record! Next day. New record! There are times like this over the past 16 years where I again question the market and gold. Best for me to tune most of this out for my sanity.
But I guess that’s what it is supposed to make me do. I’m missing out, dammit! The only saving grace is instead of cash on the sidelines perpetually earing 0%, it is now earning over 5%. So I can wait and nibble here and there.
Oh, it’s Wednesday. New record! :-)
It’s how the markets work, Mike. I don’t know what else to say. NFTRH 793 went into all the contrary indicators springing up, the headlines required to build a top (double or spectacular blowoff) and the indicators in play that show how high risk is. If you can’t make this your bitch, that is, make it fun, then you should avoid it. Got to be an unbiased nerd or something of a lunatic to participate the right way. Nice, normal people are not built for it.