Wednesday, September 2, 2009

US Dollar forming a bottom?

I believe looking at the dollar we are in a bottom forming process, the question though is will there be a breakout? Why would there be a breakout? Both good question, and I believe there is really no reason for the dollar to rally other than since it has been hit so hard it may be time for the bears to give this thing a break.

From the daily chart you see above, the 3/10 MACD, has been consistently making higher lows while the dollar is making lower lows. That to me is a bullish divergence. I think 77's will hold and may actually be a good play to take a chance on.

If for some reason the dollar does start to move up, that would not be good for stocks. I know Gold had a good day today as well, my EOD charts on Gold haven't updated yet when they do I may do a quick post on that and Oil, as it is an important thing to keep an eye on.