THE DOLLAR

A lot of commentary at the moment around the demise of the USD and the big shorts in place globally


I offer charts and some simple observations around the Greenback....chart 1 sets the scene for Peak USD in 2020 and Chart 2 shows G8 currencies relative movements since that day (indicator available here for a small charitable donation)

https://uk.virginmoneygiving.com/FXCorrelator


#1 USD has without doubt been the alpha Sell since mid March with 1100 pips fall

and even the (yellow) Yens demise has not eclipsed it ...


#2 USD has rallied in last 2 months since Labor day in early September ...approx 25% and breaching R2 on chart ....now sitting between key support / resistance levels as the US Election looms .....


unless equity markets now collapse I am still relatively Bearish on USD ....certainly will be until I see R1 get breached ....then we will have a game on our hands ...the presidency will be a long and painful fight with twists and turns on a daily basis and a bitterly disputed outcome whatever happens - so bring sandwiches


and if i don't like what the Dollar is doing i simply go play with the other 7 currencies ....sure the USD represents a high % of all trades conducted on the global stage ....but its not the only game in town if its patterns become confused and unpredictable - that's just plain gambling gang...and remember we are Traders


for me the much more interesting currency is Red GBP (Sterling) ....riddle me this ....how can a country with such a poor political response to Covid (so far) and a ragged economic record and reputation now staggering into European Exile be doing so well on the currency front ? (since September anyway)


is the UK finally doing something right or are the other G7 currencies just plain doing more stuff wrong ?


or are we about to see power shifting again going into winter ?


N





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