Friday, June 27, 2008

Is The U.S. Dollar Headed For Another Leg Down?



Above is a weekly chart of the U.S. Dollar and in the lower pane is the stochastic oscillator. Many of the highs that we've seen in the dollar over the past couple of years coincided with stochastic readings above 80.

As you can see the stochastics reached the 80 level last May which is when I turned bearish on the dollar and I still remain bearish even though last months sell signal was a little bit early.

I think in the weeks to come we'll see the dollar sell off while gold and the foreign currencies should rally.

3 comments:

jh said...

Kevin,

I love your blog! Thank you for sharing your insights.

I want to enter gold, but have missed the past 2 days run up.

Any suggestions from a pro on entering a trend late?

Thank you,

jh

Kevin said...

Wait for a pullback and don't chase the market. There should be a dip but if there isn't, don't feel bad because the good thing about trading is that there is ALWAYS an opportunity in some other market just right around the corner.

Gary said...

JH,
Gold is still trying to put in the A wave rally. There will most likely be a B wave decline before the real move starts later this year.

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