I’m back from Mexico, and at a good time, too – things are hopping. I’ve just written up a trade for Red-Hot Commodity ETFs, and I’ll have one for Red-Hot Global Small Caps this afternoon or tomorrow.
In the meantime, let’s look at a chart of the U.S. dollar Index. First, here’s the close-up action …
You can see that the U.S. Dollar Index is back above its broken uptrend, and now testing overhead resistance. There are strong fundamental forces at work here. Greek debt was downgraded to junk status. This is fanning the flames of a spreading sovereign debt crisis in Europe and worries that the euro could go much lower or not survive at all.
Now, let’s take a longer-term view of the U.S. dollar.
You can see that a successful breakout here gives us a target of just under 84 on the U.S. Dollar Index. However, I don’t trust technicals much here – the broken uptrend failing as a signal is one reason why. But really, we are watching some big fundamentals shifts in Europe and perhaps all fiat currencies.
And by that, I mean that gold is strengthening along with the U.S. dollar. European investors are seeking safety, and precious metals may provide it. These are strange and powerful days – stay tuned.
Related Posts
- Charts of US Dollar and Euro (06/21/10)
- 2 Charts on the Dollar and 1 on Gold (07/15/10)
- Two Charts — Oil and The US Dollar Index (01/22/10)
- 2 Charts of the US Dollar (04/17/10)
- Keep Your Eye on the U.S. Dollar Index Today (03/26/10)
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