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Monday, January 9, 2012

US Dollar Update: Dollar Rally is Just Gettin' Warmed Up

[NOTE:  Intraday market discussion is being held in the comments of the SPX Update (next article below).  Please join us there.  :) ] 

The dollar continues to track my roadmap from September 3rd, when I first suggested a massive rally was on the horizon.  The most recent update from October 29 nailed the bottom perfectly -- and if the dollar continues to track, then the dollar rally is about to accelerate even faster. 

The dollar appears on the verge of entering a nested third wave advance, which should soon explode to the upside.  I have updated the daily dollar chart to show the targets for wave (iii) of iii of (3).


If the short-term count is correct, the dollar may do a little backing and filling first, before launching higher in wave 3 of (iii).  79.83 is the level that needs to hold for the short-term view that the dollar has entered wave (iii) to remain viable.  At the hourly level the dollar appears to have completed a small five wave advance, and may be due for a short-lived correction.  Correction target box in yellow on the chart.

It bears mentioning that this first wave is a very good-looking impulse wave -- about as clean as they get.  If this is indeed the beginning of a nested third wave advance, it's always possible that the correction won't even make it down to the 38% Fib zone.




The original article, and many more, can be found at http://PretzelCharts.blogspot.com

8 comments:

  1. For intraday market discussion, please join us on the SPX Update thread, in the blog post below this one.  :)

    http://pretzelcharts.blogspot.com/2012/01/spx-nya-dow-updates-top-in-sight-no-new.html

    ty

    ReplyDelete
  2. PL  Always love your analysis and the new guideline regarding the use of a Disqus ID.  I now have one and will stop using Shine as my online ID.

    With regards to the dollar/euro, does the strengthing dollar signal a bull or bear case for the SPX?

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  3. Bear case.  Strong dollar indicates deflation.  Equities have been rising primarily in response to QE inflationary signals-- i.e., they haven't been gaining "real" value.  Strong dollar also hurts the bottom line of exporters like Apple, Caterpillar, etc..

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  4. Hi PL,

    Do you have an opinion on gold?

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  5. Hi PL, not sure if anyone else is having problems Im not able to see any of the comments. I was able to last night but this morning they have all disappeared. Except for one on this post.

    ReplyDelete