I. Important news from the week:
1. Gold stands high.
2. HUI is 400+.
3. US Stockmarket new high, records on Dow, S&P500.
II. As I wrote before:
FED blew it!!! They totally destroyed the dollar in long term. I think they will inflate now, and stock market will go higher and higher, but only in nominal terms.GOT GOLD :-)
As you can see, back in 1992, USD was down once 78.43, well, we had similar reading, I can not say how the recent low was, but was close to 78.43.No comment here.
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.Unfortunately, last week we had proof that our beloved wedge, is wedge no more.
It was transformed in parallel bearish channel.
Now, even if we see USD up, it will be not an uptrend, but just a correction.
III. The parallel uptrend (old wedge):
USD index weekly chart:
The wedge is transformed into a parallel channel. Then the price bounced back. Then price went to brown line and bounced back down - this is shown well on 1 hour chart on EUR/USD. We could have double top, but is still early to trade it.EUR/USD 4 days chart:
Same situation here.EUR/USD 1 day chart:
Here you may see those double top forming, but is still early. Also I said "forming", we do not know if this is double top or not.EUR/USD 4 hours chart:
Here is "speculative" chart. Mess is full and we can not decide what will happen. Downside is 1.40.50 - support, then 1.40.00 - very strong support. Upside - 1.42.20/30.I personally am bullish on EUR, even is a bubble. But bubbles must be exploited :-)
IV. Summary:
Generally EUR will rise now, USD to fall, but play carefully.
Happy week and trade!!!
V. Carry trade with AUD/JPY:
Will not be updated this time, probably tomorrow.
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