Dollar Direction ^ V or >

[mayday]

We need a thread that predicts dollar movement to help in determining our moves in the I fund. I'll start with this quote from Paul Van Eeden about the dollar. { The dollar is a floating abstraction created by a bankrupt government supported only by legislation and the confidence of a brainwashed population.}

[mayday]

The Fed wants a strong dollar. This tends to push inflation down. The Fed is more concerned about inflation than weakness in the economy.

[mayday]

China just raised thier intrest rate. When we raise our intrest rate the dollar falls. So China whats to make their currency fall. A falling currency tends to push inflation up.

[James48843]

I hate waking up to headlines like this:

China shares tumble as panic spreads

Last night I went to bed at 1:30 am, with China down a little over 4 percent, but all the other Asian markets showing green.

This morning I wake up and Europe is all red.

Hmmm....

[mayday]

I hate waking up to headlines like this:

China shares tumble as panic spreads

Last night I went to bed at 1:30 am, with China down a little over 4 percent, but all the other Asian markets showing green.

This morning I wake up and Europe is all red.

Hmmm....

China has an economy thats hot middle income class is growing fast they want to invest as well as buy everything in sight.

[mayday]

Dollar v .22 {.27%} Gold ^ $1.70

[mayday]

The dollar should be headed down soon gold is on the rise.

[FundSurfer]

It looks to me as if the dollar is beginning to trend upward. We may be somewhat overbought right now meaning we could be in for a slight drop. However, I think the drops will not be as big as they have been.

[mayday]

It looks to me as if the dollar is beginning to trend upward. We may be somewhat overbought right now meaning we could be in for a slight drop. However, I think the drops will not be as big as they have been.

I noticed that today gold down almost $6.00 a ounce dollar headed up.

[350zCommTech]

I noticed that today gold down almost $6.00 a ounce dollar headed up.

I think the dollar is up because yields are up.

Anyway, what do you thing gold is going to do tomorrow? I think down.:)

[mayday]

I think the dollar is up because yields are up.

Anyway, what do you thing gold is going to do tomorrow? I think down.:)

I think the dollar is headed up.

[mayday]

I think the dollar is headed up.

Roughly for every .10 move on the dollar gold moves $2.00 in the opposite direction. Gold is headed for a test of $640.00

[Brett]

In the "Pony Express" of our personal TSP growth; Is it time to jump off this I-fund Pony and get on another? As long as the dollar was falling, we were making money.

[mayday]

In the "Pony Express" of our personal TSP growth; Is it time to jump off this I-fund Pony and get on another? As long as the dollar was falling, we were making money.

As you know it all fluctuates mid Apr. gold hit 692 now its around 650 mid Apr dollar hit about 81.50 and that was low now its at 83.16 I see an up-trend in the dollar and a down trend in gold. Yet the dollar is not the only thing you look at in the I fund.Overseas markets are looking like they are ready to take off especially if we rally today. I'm looking for a quick dive into the I fund today

[mayday]

http://preview.tinyurl.com/2uskcm Lets see if I did this right. Should be spot gold chart.

[Show-me]

Your doing good you just copied the preview one.

http://tinyurl.com/2uskcm

[mayday]

Your doing good you just copied the preview one.

http://tinyurl.com/2uskcm

Thanks Show I'll try to do better next time.

[NTXDiver]

Looks like an interesting thread. Following the FOREX URL, gold is trending down today (as of 8am). Do you think the I fund will follow suit?

[FundSurfer]

Dollar is trending up. The recent jumps have outpaced the trend, dollar is overbought. I expect a short term drop but expect the upward trend to continue.

[mayday]

Dollar is trending up. The recent jumps have outpaced the trend, dollar is overbought. I expect a short term drop but expect the upward trend to continue.

Ditto.

[NTXDiver]

Thanks for the info....I'll keep watching. After yesterday's results with the funds, I imagine lots of folks are willing to stick in for a while longer. It was a rather rocky week for some of us :nuts:

[mayday]

Thanks for the info....I'll keep watching. After yesterday's results with the funds, I imagine lots of folks are willing to stick in for a while longer. It was a rather rocky week for some of us :nuts:

I wish every week was like last week. I cleaned up.

[Gilligan]

Looking at the last 3 months of activity, I think the dollar could drop to 82.0, however the dollar will rise in the long term.

[mayday]

http://tinyurl.com/22j9hy A little something to read about the dollar direction.

[mayday]

Gold^0.21% Dollar v 0.12%

[350zCommTech]

Looking at the chart of the USD, it appears that Friday was definitely the turn around. IMHO, the USD might be headed towards 81, this year's prior low. I'm anxiously waiting for an opportunity to get back into the I fund.

[mayday]

Looking at the chart of the USD, it appears that Friday was definitely the turn around. IMHO, the USD might be headed towards 81, this year's prior low. I'm anxiously waiting for an opportunity to get back into the I fund.

It does look to be headed south to the 20DMA I'll wait a tad before jumping into the I fund. I'm expecting another round of profit taking on wall street today.

[James48843]

Premarket- looks like the "I" is now down .06 cents.

[mayday]

As crude goes up there is more demand for gold. Dollar is holding steady down six cents moving towards 20DMA of 82.50

[mayday]

Dollar and gold at their 20 DMA Dollar v (0.07%) Gold ^ (0.14%)

[FundSurfer]

I'm surprised. I expected a "rush to safety" increase in the value of the dollar as a result to the terrorist action in UK. The lack of a rush could be that we are beginning to become desensitized to terrorist activity, or the recent car bomb defusion and poor attempt a car bomb at the airport were not scary enough, or the dollar is going down because there are a lot of people who want to sell dollars.

The dollar is pretty low right now. I don't really see it going a lot lower. I think there is a real good chance it bounces. I expect it will bounce at least 1% over the next week.

[FundSurfer]

"The prospect of renewed terrorist activity is failing to detract from the fact the Bank of England is tipped to hike interest rates at the end of the week," said David Jones, chief market analyst at CMC Markets. The bank's key rate is currently 5.5 percent.

http://biz.yahoo.com/ap/070702/dollar.html?.v=5

[mayday]

Gold is up 1.00% Dollar is down .65%

[350zCommTech]

1739


Looks like the dollar found support again at around 81.3.

[350zCommTech]

The dollar does a "sell the rumor buy the news" after a hike by BOE. My guess is that it will continue to rise tomorrow on strong non-farm payroll.

[Bullitt]

The dollar is sitting on support around the 80 level. This support level has held strong for us since the late 80's. At the very least it could cause a bounce in the days/weeks to come but it's going to take much more than that to get the dollar to reverse it's course to the upside.

[FundSurfer]

Where'd you get a chart that went back to the 80's? I've looked and have not found one that went back that far. I'm surprised the talking heads are not talking more about this.

[Bullitt]

Try this chart. Good stuff.

http://investmenttools.com/futures/forex/welcome_the_us_dollar__page__dollar_point___figure _chart__dollar_futures_.htm

[FundSurfer]

I had not seen that one... Thanks! Too bad it isn't interactive. Oh well, beggars can't be choosers, I'll take whatever is free.

Bottom in 1992 seems to be between 78 and 79. You could say that the Gulf War caused the major slide in the dollar in the early 1990's And that the current slide started after 9/11. You have to wonder if we are going to retest the 1992 low.

[Bullitt]

Note the positive divergence in the Rate of Change (ROC) on that chart I posted. Positive divergence in the ROC coupled with that double bottom could be a bullish sign.

[FundSurfer]

I've been preaching bounce for awhile now. The I-fund keeps proving me wrong. How low can it go? I still think bounce.

Big picture, I wouldn't buy dollars.

[fabijo]

I've been looking at that positive divergence for a while now, but it can sometimes take quite a while before that divergence kicks in.

[mayday]

Try this chart. Good stuff.

http://investmenttools.com/futures/forex/welcome_the_us_dollar__page__dollar_point___figure _chart__dollar_futures_.htm

Thanks for sharing the charts Bullitt very helpful. The big reason I've been shying away from the I fund is this very weak dollar. I can't put my finger on why the dollar is so weak.

[mayday]

My 2 cents Big market movers 1 Wars, 2 Interest Rates, 3 Oil Prices, 4 Currency Collapses. Whats happening a weakening dollar pushes inflation up. The Fed has not budged on rates. Consumer spending is rising faster than inflation. The talking heads are saying [goldilocks] The Fed wants a strong dollar but is dead set against inflation rising. To raise the interest rate would mean the dollar would fall further. To lower the interest rate would strengthen the dollar but speed up inflation. I say Fed predicament. Rock and hard place.

[FundSurfer]

I say Fed predicament. Rock and hard place.
This is why I expect the Fed board to begin barking like dogs. They may try to move the market with their voice.

[nnuut]

Thanks for sharing the charts Bullitt very helpful. The big reason I've been shying away from the I fund is this very weak dollar. I can't put my finger on why the dollar is so weak.

This is the PLAN!!!! Weak dollar allows the USA to compete with the other third world countries in the Market place. Get used to it, just remember don't travel overseas, you can't afford it!:sick:

[fabijo]

To raise the interest rate would mean the dollar would fall further. To lower the interest rate would strengthen the dollar but speed up inflation.

I thought the opposite would happen. Lowering rates would make the dollar even less valuable because there would be more dollars available.

[Brett]

I don’t understand this “Fed injects 38 Billion to shore up support for sagging markets thing. Where did the Fed get this money? If they just printed more, then what good is it; doesn’t it just devalue what is already in circulation? I would think, but don’t know, that it would cause some inflation. I would have also guessed that the dollar would be devalued more and cause gold to shoot up. But it seems that none of that has happened. Can anyone explain to me what the Fed did last week and what effect it will have on the economy and markets? Thanks.

[FUTURESTRADER]

I don’t understand this “Fed injects 38 Billion to shore up support for sagging markets thing. Where did the Fed get this money? If they just printed more, then what good is it; doesn’t it just devalue what is already in circulation? I would think, but don’t know, that it would cause some inflation. I would have also guessed that the dollar would be devalued more and cause gold to shoot up. But it seems that none of that has happened. Can anyone explain to me what the Fed did last week and what effect it will have on the economy and markets? Thanks.

Maybe the helicopter money bernanke was talking about before he donned the chief's hat?:)

[350zCommTech]

The dollar is down a little today, but gold is up 2%? On the day before an important non-farm payroll report? What do these guys know??:D

[mayday]

A recession is deflationary maybe thats what the Fed wants.

[Gilligan]

I looks like the dollar is forming a pennant.

[Silverbird]

This is the PLAN!!!! Weak dollar allows the USA to compete with the other third world countries in the Market place. Get used to it, just remember don't travel overseas, you can't afford it!:sick:And stop buying those unpatriotic expensive imports!(yeahright) :suspicious:

[tsptalk]

I looks like the dollar is forming a pennant.
That should be good for the I-fund - is that what you are suggesting G? In theory, the breakout would be down.

[Gilligan]

It appears that another pennant is forming. The dollar has been in an upward channel for the last couple of months but is it is getting close to long term upper resistance.

[Bullitt]

Decision Point possibly calling a bottom in the Dollar Index. Whether this could mean an IT or LT trend change, who knows.

7480
Chart courtesy of: www.decisionpoint.com (http://www.decisionpoint.com)

[tsptalk]

Does that mean to favor the S-fund over the C and I funds?

[Bullitt]

Ha, they don't tell ya that much. I wish I knew.

S probably doesn't have as much exposure to the dollar as C though.

[WorkFE]

Does that mean your in for next week anyway

[Bullitt]

I've been about 50% in, 50% G Fund for a few months now.

I'm beginning to wonder here about the dollar correlation to the stock market. Looks to me like the Yen is about to make a serious reversal to the downside which should revive it's carry trade to some extent. If the dollar does strengthen here, does anyone think a decrease in speculation could be offset by Yen weakness?

Whenever something becomes followed by so many- meaning the weak dollar correlation to the stock market- it's more likely destined to fail than continue. When I can read about the dollar/stock market correlation in Time magazine, it's become too obvious.

I still believe that any strength in the dollar is a buying opportunity in hard assets, so I am prepared to add to any long positions I have when any upward moves briefly correct themselves. Also, watch for any countries that snap up gold at the 1050-1100 level in the weeks ahead.

[Bullitt]

As Jim Rogers on CNBC continues to brainwash unknowing investors into believing that 'everybody is bearish the dollar', Jason says just the opposite. Once again, another example of how investors should NEVER make an investment decision based off of CNBC and would be best served not watching it.


Small Speculators are now the net longest they've been since February/March when the buck was topping out.7604
www.sentimentrader.com (http://www.sentimentrader.com)

[mudigha]

I believe that 2010 will follow historical trends to the T. First months we will have a strong dollar. However, I still see strength in the I. As the S&P and Nas will be mixed.

[Bullitt]

More from Jason. Count me out of this long trade.


Speculators are now more net long the US Dollar than any time in history. They currently hold 88% of all open long positions.

[JTH]

More from Jason. Count me out of this long trade.


I see you've resurected a classic! I was going over my price performance comparison charts last night and noticed the inverse relationship is not as strong as it once was when compared with Gold, Oil, and the S&P 500.

I'm not ready to close the curtians on the dollar but we do have some compelling information on the comparison charts. The Dollar has an MACD crossover with its 1st negative tick against the Euro
7871


The Dollar shows the most strength against the Yen, but the MACD is declining.
7872

Same story as the Euro for the Brittish Pound.
7873

[Bullitt]

The US Dollar looks to have completed it's fib shakeout and is ready to resume its march onward.

7972

[tsptalk]

Breakout from bull flag in Dollar...

http://www.tsptalk.com/images/mb/012010a.gif

[mayday]

Dollar looks to me to be headed down.

http://tinyurl.com/24z9zb

[tsptalk]

That bull flag is actually a pretty bullish pattern, although a similar double bull flag pattern didn't work out well for the housing index...

http://www.tsptalk.com/images/mb/012610a.gif

http://www.tsptalk.com/images/mb/012610b.gif

[Bullitt]

The influx of alleged speculators made me initially believe that this dollar rally would fizzle out quickly, however, with the massive amount of short covering and carry trade unwinding (such as Canadian Dollar, Australian Dollar, Brazilian Real selling) I think this dollar rally has legs.

The big players are stepping into the buying game.
http://www.businessweek.com/news/2010-01-28/mexico-s-bank-may-buy-dollar-reserves-from-market-update1-.html

I think the stock market along with gold put in the highs. Tops are a process. Where will all that hot money go to once it bails from India, China and Brazil? More dollar bull food: Be prepared for tightening from India (http://www.bloomberg.com/apps/news?pid=20601091&sid=acWcrjn3Ak0A).

World stock markets are rolling over. The second commodity unwinding is currently in process.

[Bullitt]

I might catch some flak for this one but bull markets do spend more time in overbought territory than a bear market does.

8219

[Birchtree]

I've been patiently waiting for the dollar 80 level. This level has always been bullish for the economic recovery and a stronger equity market at least from a historical standpoint.

[tsptalk]

Look for the dollar to pullback to 79 - 79.5 next week to give the stock market a few days to rally. Then support will be tested, as will the S&P 500's overhead resistance. Could be a good selling opportunity - unless the both break.

[JTH]

I might catch some flak for this one but bull markets do spend more time in overbought territory than a bear market does.

8219

I'll add my Slow Sto is embedded, & we are approaching a 50/200 EMA Golden Cross. It's not a great time to be in the I-Fund when folks are running into the dollar...

8220

[Bullitt]

We got that bullish 50/200 cross.

[Bullitt]

It appears the dollar has made some kind of bottom and investors are already selling the black Friday news. The dollar has been rising well before Korea did their thing so don't trip on that excuse. Also, don't use the excuse that China is raising margin as a reason for the drop in commodities.

The problems are still there (or have gotten worse) in Ireland, Dubai, Greece, Portugal, Spain... oh and I almost forgot- the US.

What kills me is for so long everyone was saying 'buy stocks because of the dollar correlation'. Well, we got the dollar rising, but the media has brainwashed investors into thinking that black Friday will save every problem in the world, even though it may bring in $20 billion tops which is a drop in the bucket towards a multi-trillion dollar economy.

I've got head and shoulders tops nearly confirmed or confirmed in AUD, CAD, GBP, EUR, Greece Stock Market, Gold, and Oil. These patterns didn't start to form when Korea started their laser show either.

I am still a deflation bull and will remain that way until car dealers cut out the $3,500 discounts, Mickey D's and Starbucks stop giving out free coffee, and retailers begin selling items without having to induce customers with major sale incentives. As long as the dollar rises against all other majors, inflation is not possible.

Long live the dollar, it will not go to zero like all Gold bulls would like you to believe.

[hessian]

I am still a deflation bull and will remain that way until car dealers cut out the $3,500 discounts, Mickey D's and Starbucks stop giving out free coffee, and retailers begin selling items without having to induce customers with major sale incentives. As long as the dollar rises against all other majors, inflation is not possible.

Hey Bullitt, nice analysis. I'd just question Oil - seen the price of gas in this last week?!
"They" really play us for dumbies/suckers, and know we are powerless to challenge their hikes - and "they" do take advantage every holiday opportunity.
I suppose its primarily the taxes that "they" hike - hoping this will help clear our nat'l debt. :cheesy: It hasn't been reflected in the price of Oil. :rolleyes:
VR
Just courtesy, note NNuut's "Oil thread" today: http://www.tsptalk.com/mb/showthread.php?p=290898#post290898

[crws]

Hey Bullitt, nice analysis. I'd just question Oil - seen the price of gas in this last week?!
"They" really play us for dumbies/suckers, and know we are powerless to challenge their hikes - and "they" do take advantage every holiday opportunity.
I suppose its primarily the taxes that "they" hike - hoping this will help clear our nat'l debt. :cheesy: It hasn't been reflected in the price of Oil. :rolleyes:
VR
Just courtesy, note NNuut's "Oil thread" today: http://www.tsptalk.com/mb/showthread.php?p=290898#post290898

Start at 15:45

http://www.youtube.com/watch?v=cTdLgtzD9eU

[Bullitt]

I'm still of the opinion that the dollar is making a long term bottom. In the face of major deficits, precious metals euphoria (http://www.bloomberg.com/news/2010-12-30/mining-ipos-may-set-record-as-investors-bet-on-metal-demand.html), and the conventional wisdom claiming that the dollar will be debased, I remain a dollar bull.

Venezuela openly debasing their currency (http://www.reuters.com/article/idUSTRE6BT45O20101230) but the US is not.

10390
bigcharts.com

[fedgolfer]

http://stockcharts.com/h-sc/ui?s=UDN&p=D&yr=0&mn=9&dy=0&id=p98789750763

UDN appears like it will stay below the future red cloud... which means the dollar will conitnue upward (not good for I fund). US indices lookin' like they'll rally with a stronger dollar... repatriation going on. Still a lot of days left in January and we need a Friday close in the weekly Q's to confirm a breakout in the Naz.

[FAB1]

never mind.

[alevin]

http://stockcharts.com/h-sc/ui?s=UDN&p=D&yr=0&mn=9&dy=0&id=p98789750763

UDN appears like it will stay below the future red cloud... which means the dollar will conitnue upward (not good for I fund). US indices lookin' like they'll rally with a stronger dollar... repatriation going on. Still a lot of days left in January and we need a Friday close in the weekly Q's to confirm a breakout in the Naz.

One of CH's links this morning had a link to an article about Brazil buying $ to keep their exports competitive and keep their inflation down. Might have something to do with $ direction at the moment.

[fedgolfer]

One of CH's links this morning had a link to an article about Brazil buying $ to keep their exports competitive and keep their inflation down. Might have something to do with $ direction at the moment.

Politics/news/hype aside, imho, I think its just a real recovery.

http://www.youtube.com/watch?v=BIJWEsgNuYI

[Fireant]

Hammered

Every move I have made the last year has been wrong... such is life... :confused:

[fedgolfer]

finally some $ action favorable to the I fund. Now, Barclays will probably ignore it.

[mayday]

Dollar up today

http://quotes.ino.com/chart/?s=NYBOT_DX

[fedgolfer]

Finally some dollar direction favorable to the I fund... 2.51% pop and the afternoon dollar action suggests Barclays maybe handicap tomorrow's I fund price with a half percent head start. Timing this thing is harder than it wAs a few years ago IMHO.

[Robo5555]

Awesome day for the I fund! Bout time...

[fedgolfer]

1.26% MSCI EAFE... the stingy bastards finally paid up on last Friday's dollar action.

http://www.mscibarra.com/products/indices/global_equity_indices/gimi/stdindex/performance.html

[fedgolfer]

...And Barclays ends up paying 20 cents or .98%

[Nordic]

Any feeling on the direction of the Dollar going forward?

[tsptalk]

Theorhetically, when they start tapering QE, the dollar should get stronger. Theoretically. But it tends to go in the opposite direction of what I think.

[Sensei]

I'm not sure how one country's currency effects the overall value of the dollar, but Japan has been on a mad rampage to weaken its yen. Just a year or so ago it was 75 to $1, and now it's almost back to 105 to $1. I think they're aiming for 110 or 120 to $1. So, perhaps more strength in the USD?