Just a follow-up on the dollar and how its developed since this original post.
Here is what the dollar chart looks like today, a "Head and Shoulders" pattern might be developing as it has now violated its 20-day EMA and seems to be headed down to the 50-day EMA = $84.10.
The first real support below the H&S is at the purple line, a pivot point just below the $83.50, ... if it gives way, ... I would expect to see the blue circle before a meaningful pause, the base below the blue circle should act as strong support.
If it stalls here, ... a three to five day (above and below) test of this 20-day will dictate its next move, if it regains the $86.00 level, then I would lean towards a continuation, with yet higher highs, which at that point, ... would negate the H&S pattern altogether.
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Weakness in the S&P has set in, its now below all three MA's, a very bearish setup, I think its something folks have been calling for since it broke above its 2008-line.
At some point, I would expect a test of the 200-day EMA (1,900+), ... a cross-over and flip-up of the MACD lines will be a clue of its next move when that time comes.
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If the S&P drops below the blue circle, I would expect to see it in and around the large purple circle next, where it has an open gap and several pivots.
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Good Luck be Safe, and Have a Great Week.
Aram, James |
