Post by uncleharley on Mar 31, 2021 20:55:43 GMT
The value of the USD has an inverse relationship to the price of globally priced commodities and many of the stocks that are related to those commodities. It is frequently easier to do a projection on one item, such as the dollar, than it is to review each item that may be affected by that projection. Consequently I am using a longer term 1 week chart to project where the USD may be heading over the next quarter or so and hopefully add something to the investment plans that anyone might be making.
The weekly chart for the USD shows that beginning last March the dollar began a 9 month decline with an occasional pause, in value as measured against a basket of Developed Nations currencies. The decline turned up in the first week of Jan 2021 and continued up, also with an occasional pause, until yesterday. The pattern that has resulted from the past 2 qtrs of trading is a rounded bottom [which is bullish]. However, because the todays trading showed a small decline in the dollars value we have the possibility that the next few weeks of trading could develop a right shoulder to an inverted Head & Shoulder pattern [which would be mostly bullish]. The 3rd possibility is that we have a mild correction to the recent rally and then move up. That would result in a Cup with Handle pattern that would be bullish. The likelyhood of a bearish intermediate term future for the dollar is minimal since the ralley has been strong and the bottom is a double rounded bottom which goes back 3 yrs. The projected advance from current levels or from an inverted H&S Pattern or from a CupwHandle pattern would be between 4 & 5% over the next 6 months or so.