US Dollar Stage One

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We would like to mention first that we realize we haven’t written a blog in several days. Some of this is due to the Thanksgiving holiday and some due to time considerations. We have had to say good bye to someone who has been with us for many years and the transition has required time and energy directed elsewhere. We will be back on track we are sure very soon.

Now for a little market noise. The US Dollar deserves some comment we believe as today saw another hard down day. However, new lows were not made. The Dollar has had an effect on so many of the markets according to most every analyst so it is of some interest to note that while the Dow, Gold and Silver made new highs for their respective moves that the Dollar did not.

We have included the chart of the US Dollar cash index here to illustrate what we refer to as a stage one breakout. We realize that this is a rather steep trend line that was broken to the upside but what makes it qualify as a stage one to us is that once broken it has not been reviolated. And we wouldn’t think much of it except that it is something we have observed over the years and this bodes watching. A close back below the line, we believe, would qualify as a violation and be an indication that the likelihood of a bottom in the making was less likely.

In summary, this is a situation to be aware of and not a recommendation to buy or sell the US Dollar. It is a suggestion, however, that something could be brewing and that it is worth watching and being prepared for.

Good trading to all

Jeff
CB&S

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