US Dollar Index Testing Key Support
- Posted by JC Parets
- on February 1st, 2013
The Dollar is flirting with some dangerous levels here. This support right around 79 represents the potential neckline for a head & shoulders pattern that would confirm a continuation of the downtrend.
After rallying into last summer, the US Dollar got hit hard into September. Since then, it has been building this interesting, yet bearish, pattern that looks to be resolving to the downside.
Here is the chart of the US Dollar Index Futures:
The 2.5 point height of the pattern would give us a measured move down to about 76.5 upon completion. The Euro strength lately cannot be denied, and looking at this chart above it’s easy to see why.
We’ll certainly be watching this chart closely as US Equity markets tend to correlate negatively to the US Dollar. The 1 yr correlation is about -0.70 with the S&P500 and -0.70 for the quarter as well.
Full Disclosure: Nothing on this site should ever be considered to be advice, research or an invitation to buy or sell any securities, please see my Terms & Conditions page for a full disclaimer.blog comments powered by Disqus
J.C. Parets is the Founder & President of Eagle Bay Capital, LLC. He is a 10-year veteran and Market Technician who actively manages money incorporating Technical Analysis and Behavioral Finance into his practice. JC’s work has been featured regularly on CNBC, Fox Business, Bloomberg, Business News Network, Wall Street Journal and Yahoo Finance among many other financial media outlets. More...
- BNN Appearance: Interest Rates and Apple
- This S&P500 Chart Still Makes Me Nervous
- How To Prepare For a Lower Rate Environment
- Audio: Benzinga Morning Radio Show 5-21-15
- BNN Appearance: Agribusiness Stocks & US Dollars
- Agribusiness is My Favorite Base In The World
- Audio: Benzinga Morning Radio Show
- Here’s Why I like Shorting Disney Up here
- A Not So Happy Cinco De Mayo For the Mexico ETF
- One-Third Of the Year Is Over. Now What?
Archive by Year