Let’s start with the chart of my last post (episode 5) :
I was pointing out on this chart that we were approaching a very strong resistance area. If this analogy was to work, the $USDX had to stabilize and regain some strength.This chart has been made the 27th of March. Today, it looks like that :
We had had a strong rally followed by a significant pullback. I didn’t write any post when we rallied because I had some other indicators that did not validate the rally. So, we’re back here, on the resistance.
Things look easy from here, we break it or we rally hard. I’m in for the rally. I don’t see the greenback loosing grip right now. It wouldn’t make sense when the Fed lost a bit of its dovish tone…in fact, this analogy -considering the magnitude of the correction- would suggest that we’re going to rally hard.I suggest that you read the 4th episode of this analogy where I detailed on a bigger time frame the descending wedge in place for the $USDX since 1985. If the $USDX fail at those levels….it would be an epic fail.
Time will tell, but it will be quick from now.