Three months in a row of relentless buying in the Dixie (US Dollar) is enough for a breather.
That’s not the reason but more of an excuse. September ends tomorrow and the ECB will announce their version of our quantitative easing program aka – dropping money from helicopters.
It seems reasonable to assume the Euro has been falling precipitously sine May 2014 almost without interruption and now with almost nobody bullish on the Euro and everyone bullish on the US Dollar it seems fitting we’re in for a short term turn.
Make no mistake, they’re both not done yet. The dollar has farther to go on the upside, and flipped over, the Euro has just as far on the downside. Since nothing ever goes in a straight line, we can anticipate short term rallies from time to time. This seems like one of those times as the technical analysis is also indicating multiple buy signals knocking at the door.
The main trend for the stock market continues down, with more selling pressure on the way. Expect a lot of back and forth this week as traders and institutions jockey for position leading into the ECB on Thursday and the Jobs report on Friday.
Gold is nowhere new, but Crude oil went on a nice run today. More upside expected in oil in the short term, followed by downside into the mid 80s.
More detail in tonight’s video: