1. Most stocks, commodities and everything is rebound, from fall previous week.
2. First bank went bankrupt, because of sub-prime mess (not quite sure in this, may be they are in process to bankrupt)
3. USD fall sharply in Friday hitting 1.36.80
4. Many annalists believe that FED will cut rates in September. This is rumor, not a news.
5. RIP Aaron Russo, one of the few American Patriots, which even I admire. (I, who have nothing to do with USA)
II. The wedge in USD and EUR index:
USD index now heading down, and is 1/2 down the road to bottom (support) line of the wedge.The target is below 80 (again). Note that even (for some reason) USD go down, only to the pink line, it still have some way down, so is safe to speculate as "dollar bear".
Before, I wrote following:
For first-time readers, and those who do not know, the wedges are reversal patterns. This wedge is bullish for USD index, no matter what people say for US economy, debt bubble etc. I am sure that at the end of the year, the USD will be lower, but wedge suggest we will have one bounce before that.This is still valid, but probably we will first see USD index down to the support, and then another rise.
EUR index:
Because USD index is dominated from EUR-o currency, and EUR index is dominated from USD currency, the EUR index looks like mirror of USD index. Same wedge, same raise.EUR index : USD index ratio:
The ratio show same wedge, and once again suggest EUR will go up, USD - down.III. Wedge in EUR/USD:
EUR/USD 3 days chart:
Our favorite chart. It is like the EUR/USD weekly chart. Wedge is shown once again, and EUR is half the way up. Target is somewhere about 1.40. I will calculate exact target later in the week. Once again, EUR - up, USD - down.EUR/USD 1 hour chart:
UPDATE: SOMETHING IS WRONG WITH THIS CHART, BUT THE CONCLUSION IS STILL CORRECT. WILL REPOST TOMORROW THE CORRECT CHART!!!
This is speculative chart. It shows the upper channel of EUR/USD. We have 3 parallel lines. Currently, EUR may found support at what supposed to be resistance some time ago - brown line. Direction - either UP, or down to the support (blue) - 1.35.90, and then UP.IV. Summary:
EUR continue to rise, USD to fall.
Continue to watch what the JPY will do in general, even I do not think it will affect EUR/USD.
Caution is warranted, since most of annalists are very bullish to USD right now!!!
Happy week and trade!!!
Rest in peace Aaron Russo!!!
III. Carry trade with AUD/JPY:
I did not followed this market for some time, but looks like, there are some exiting developments here. In case AUD break the bottom brown line, then there will be nothing to stop the AUD to raise at least to upper brown line, or even higher.Wait, Passions is everything ;)
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