Two Fresh Ways to Short the Dollar

From the Desk of Ian Culley @IanCulley

Y’all know the drill… 

Dollar down, stocks up.

That dominant inverse relationship remains firm as stocks rip and the dollar dips. 

The market’s message is clear: Buy stocks, sell dollars.

If you trade the FX markets, I have two new setups to ride the falling dollar…

First up, the US dollar-Swiss franc pair USD/CHF:

I’ve been tracking a generational topping formation in the USD/CHF (bottoming formation in the Swiss franc futures) for most of this year.

It wanted to break down in July but lacked follow-through.

Today, the USD/CHF is printing fresh 8-year lows, flashing another sell signal.

I’m short the USD/CHF below .8575 with an initial objective of .8125.

Next, the US dollar-Swedish krona pair USD/SEK:

The USD/SEK is undercutting a shelf of former lows. 

Meanwhile, the 14-day RSI is posting its third oversold reading since July. This is the definition of a bearish momentum regime, as the bears are in full control of this FX pair. 

I like the USD/SEK short below 10.10, targeting 9.38.

That’s it for today: two fresh USD shorts.

You won’t hear much about these pairs in the headlines. But they’re both US Dollar Index $DXY components, and they’re both printing fresh lows.

That’s critical information for every investor.

Stay tuned.

Let me know what you think. I love hearing from you!

And be sure to download this week’s Currency Report!