Both the Yen and the Euro are at decision points. The US dollar is forming a Bull flag vs. the yen (USD/JPY; USDX). The Euro (EUR/USD) is topping out at the Nov. 2010 high. That makes this the perfect moment for the US dollar index to find support. If it doesn’t, the damage may bring the US dollar index back to the 2009 market timing low.
You know the kid at the playground who yelled “Na na na naaaaaa naaaa”? The US dollar is now doing that by “playing” with the breakdown point of the US dollar index at 75.63. It closed below there on Friday. Now it could go either way. Check back here just before the open tomorrow, and I’ll have an update here for you.
If the dollar rallies strongly, Monday will not be a good day for stocks OR commodities. I just published my latest SP500 Index assessment here (and it is free to subscribe): Click Here to Subscribe to my FREE SP500Tracker™ Market Timing Newsletter and free “Tips”
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© 2011 David B. Durand, M.D. All rights reserved.