USD Is The King But For How Long?

Posted on Posted in Daily Blog Post

20141001a

I have long believed that USD has moved into the new Cycle uptrend despite the fact that many analysts calling for the demise of the USD. It will but not now. Tell me, who wants to bring more capitals into Japan and Europe for their messy and ailing economy. U.S now is perceived as a safer place for investments in terms of better growth and security. USD now is considered as the One eyed King in the kingdom of the blind.

Look at the following chart which shows the breakout in USD. On a short term basis, USD is about to retrace due to weekly overbought condition. After a period of expected consolidation, USD should challenge the next 2 resistances around 88 and 92.33.

20141001b

In the interview with Verslo Zinios yesterday, Draghi also repeated that the ECB was willing to instigate further stimulus measures if necessary.

"We stand ready to use additional unconventional instruments within our mandate, and alter the size or composition of our unconventional interventions should it become necessary to further address risks of a too prolonged period of low inflation," he was quoted as saying.

Where is the dollar/yen going next? Edwards says ¥120 is where he’d put his money, and if the dollar’s rise is boosted by a breakout for the dollar index, a fall in the yen below ¥12- will mark an end to the currency’s 30-year uptrend. Edwards gets a lot of flak for being such a bear, but he offers one last warning against dismissing him as a ‘chicken little’:

“Sound far-fetched? One of the few things I have learnt over 30 years in this industry is that when traders decide the yen/US$ starts to move it can jump by ¥10 or ¥20 very, very quickly indeed,” warns Edwards.

Share This :
Facebooktwittergoogle_plusredditpinterestlinkedinmail

Leave a Reply

Your email address will not be published. Required fields are marked *