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Dedollarization

DXY - Dollar Bearish pattern!Bearish wedge for the Dollar strength index. ABCDE Pattern forming - we should get the E as this bearish move plays out. still could see another short term rally heading into the FOMC meeting July 26TH. *another pause from the fed would cause more weakness in the DXY *Fednow rumoured to go live July 20th - although still a rumour. *Extra liquidity will be created from Fednow, adding to the overall dollar supply which should cause weakness in the price/value. *Brics nations advancing - more countries are joining! *Russia is planning to create a gold backed currency. I believe this wedge will play out is just a case of when, another pause from the fed would align nicely with this chart. Interesting times ahead!. let me know your thoughts below.
CAPITALCOM:DXYShort
by dibz1996
Potential Bear Flag on DXY Monthlywww.tradingview.com We'll see how this plays out. I think we will see DXY at historic lows within the next few years. I believe this because the USD is on track to lose world reserve currency status and US government doesn't seem to be taking it as serious as they should.. If this was to happen, the USD would hyperinflate and interest rates would be forced to rise to extreme rates. De-dollarization could be the event that sends USD into a death spiral and ultimately a third world country. On the other hand, i think the people running the show in America are intelligent and won't allow for such an event but i think the force of de-dollarization is being underestimated. It will be interesting to see the DXY in future decades. My prediction is it goes into a slumber for a decade or two in the near future. Once BRICS release their alternative form of currency many countries would switch to it and cause a domino effect away from the dollar.. It's also possible we see many countries simply trading in their own pairs with a much more efficient system, potentially using DLT. We shall see.. Interesting times.
TVC:DXYShort
by Neanderthal24
Euro Soars with Dollar WoesOne thing about tables, they turn. This time last year, the dollar was unrivalled. Now, it is being challenged amid a banking crisis, recessionary fears, and a debt ceiling drama. Having stepped up on the rates faster than the rest, the US Fed’s combat against inflation fuelled a dollar rally . It now finds itself between a hard place and a rock. Many expect the Fed to pause. In contrast, the ECB, having been slower off the block, has gradually lifted rates with ample headroom for further policy intervention to fend off a resurgent Euro area inflation. This paper explores fundamental forces driving a rally in the Euro and the headwinds facing the dollar. With EUR/USD making a golden cross on March 27th, this case study posits a long position in Euro using the CME Euro FX Futures delivering a 3x reward to risk ratio with entry at 1.1025 and target of 1.17 hedged by a stop at 1.08. Crushed and Bruised Euro is Fighting Back 2022 was a crushing year for the Euro. Geopolitics plunged Europe into an energy crisis. Bleak prospects plus soaring inflation meant deep recession. The Euro was wounded. The Euro was dealt another blow as the ECB was slow to lift rates. Key eurozone rates were well below those in the US, as the Fed was all pedal to the metal with unprecedented hikes. Higher yields in the US attracted foreign funds, boosting the dollar at the expense of other currencies. Tables turn and times change. Euro's rise is in part thanks to milder European winter. Warmer than normal and prudent energy consumption has kept gas prices in check. The region may well avoid a recession. In fact, it posted a surprise output growth in the final quarter of last year. A hawkish ECB also well supports the Euro. It continues to hike rates to tackle inflation, which remains stubbornly high. As rates in Europe rise while those in US stall, the Euro will attract capital inflows from across the Atlantic. Dollar’s dominance is being challenged Over the last 10 years, the Dollar Index (DXY) has gained ~25% while the EUR/USD has shed ~19%. The rotation away from the dollar is underway. Not only Euros, but the dollar has also been losing ground against other majors, including the sterling and the yen. Easing inflationary pressures should spell victory for the Fed allowing it to tone down its fighting monetary stance. Premium for insuring against US government default spiked to its highest level in more than a decade amid political impasse related to debt ceiling. While this political embarrassment is likely to be inconsequential, the tiny risk of a dollar debacle cannot be ignored. Investors hedging against this risk are likely to push the dollar lower. Is this De-dollarisation? The de-dollarisation camp shouts loud. But ignore the noise. Surely, the weaponisation of the dollar has alarmed nations. Not surprisingly, many are attempting to wean away from dollar dependence for trade settlement. The dollar’s share in forex reserves used to be 71.5% at the turn of the century and has gradually declined to 58.3% as of the end of 2022. The dollar remains at the core of global trade and finance. The dollar forms 88% of FX transactions. Distant second is Euro at 31%, according to 2022 BIS figures (aggregates equal 200% as each transaction involves two currencies). Transactions involving the Chinese yuan having grown at 70% over last three years represents a mere 7% of the total. About 60% of the world's forex reserves aggregating to USD 11 trillion are still denominated in dollar. The dollar will continue to play a pre-eminent role in global trade and as a global reserve for a long time to come. Absent a credible alternative, albeit weakened, the dollar is here to stay. Rate Expectations Point to the Fed Pausing Earlier Than ECB CME’s FedWatch tool shows a 78% probability of another 25bps rate hike at the next meeting on May 3rd and a 67% probability of no rate hike at the June meeting. Fed pause before pivot remains market expectations. Meanwhile, Reuters reported that the ECB is expected to raise rates by 25bps at its next meeting in May. Crucially, ECB survey of professional forecasters points to another 25bps rate hike in Q2 before pausing. Asset Managers & Funds are positioning for Euro to rally CFTC’s Commitment of Traders (CoT) report shows that leveraged funds and asset managers are bullish Euro. Asset managers increased net longs by 7.4% over the last 12 weeks. Leveraged funds have flipped from net short to net long, increasing long positioning by 125%. Meanwhile, the CoT for DXY futures shows that asset managers are still net long but have reduced long positions by 20.5%. Options Market are signalling bullish Euro and bearish Dollar Monthly options on Euro FX futures are trading with a put-call ratio of 0.87 pointing to more calls than puts, indicating Euro bullishness. Euro buoyancy is particularly apparent for June expiry options which have a put-call ratio of 0.6. Meanwhile, thinly traded options on DXY futures expiring in June have a put-call ratio of 1.66 signalling that market participants are bearish dollar with 1.66 puts for every call option. Trade Setup Each lot of CME Euro FX Futures provides exposure to 125,000 Euros. Every 0.00005 increment in the contract represents a trading P&L of USD 6.25. ● Entry: 1.1025 ● Target: 1.17 ● Stop: 1.08 ● Profit at target: USD 8,440 ● Loss at stop: USD 2,810 ● Reward-to-risk: 3x MARKET DATA CME Real-time Market Data helps identify trading set-ups and express market views better. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com DISCLAIMER This case study is for educational purposes only and does not constitute investment recommendations or advice. Nor are they used to promote any specific products, or services. Trading or investment ideas cited here are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management or trading under the market scenarios being discussed. Please read the FULL DISCLAIMER the link to which is provided in our profile description.
CME:6EM2023Long
by mintdotfinance
3
The USD, China and the De-dollarization challengeThe US dollar has maintained its status as the world's dominant reserve currency for decades, thanks to its perceived security, resilience, and the depth and liquidity of US markets. Despite concerns surrounding the dollar's hegemony, it remains a crucial player in global transactions. Meanwhile, China's economy faces challenges, such as growing provincial government debt, an expanding real estate bubble, and potentially inflated GDP numbers. In addition, China's need for US dollars and the push for de-dollarization by countries like Russia, China, Iran, and Saudi Arabia have gained attention. This analysis will explore these issues in depth and examine why moving away from the US dollar system is complex. China's increasing debt, falling real estate prices, and the growth of its banking assets to around 55% of Global GDP are all causes for concern. The country's M2 money supply has grown at a 9% yearly rate, reaching HKEX:40 trillion, more than double its GDP. If China's GDP numbers are indeed inflated, as suggested by the Brookings Institution, this could exacerbate the problem. Moreover, the yuan (RMB) faces significant challenges in becoming a globally accepted reserve currency, primarily due to China's capital controls, illiquid markets, and authoritarian governance. In contrast, the US dollar remains dominant in global central bank reserves and transactions. This is partly due to the dollar's resilience and the perception of the US's security and stability. Although reserves have shifted for countries with closer trade relations with China, such as Indonesia, Malaysia, Hong Kong, Singapore, and Chile, the US dollar remains the world standard for now. The push for de-dollarization has gained momentum recently, particularly after the Russia-Ukraine conflict and Western sanctions against Russia. Countries like Russia, China, Iran, and Saudi Arabia seek to move away from the US dollar system to reduce their dependency on the US economy and gain more control over their financial systems. However, moving away from the US dollar system is challenging for several reasons. First, the US dollar's dominance in global markets ensures its continued importance in international trade. Even if countries like China and Russia attempt to shift away from the dollar, many other countries will likely continue to rely on it for their transactions, as it provides stability and liquidity. Second, while the yuan is gaining prominence as a reserve currency, it still faces significant hurdles in becoming a globally accepted alternative to the US dollar. China's capital controls, illiquid markets, and authoritarian governance make it difficult for other countries to trust the yuan as a reliable reserve currency. As a result, it is unlikely to replace the US dollar on a large scale in the foreseeable future. Third, OPEC members continue to price their oil in US dollars, despite the currency's decline relative to other world currencies. Economic, technical, and political factors prevent them from switching to other currencies or a basket of currencies. The benefits of such a switch are limited, and it would not benefit all OPEC members equally. Furthermore, the US will unlikely allow OPEC to disregard the dollar without consequences. Finally, the BRICS nations (Brazil, Russia, India, China, and South Africa) are reportedly considering creating a new currency to facilitate trade and promote de-dollarization. However, this plan faces several obstacles, such as political disagreements among the BRICS countries and convincing other nations to adopt this new currency. Additionally, the benefits of a new BRICS currency are uncertain, and it may not be enough to destabilize the US dollar's dominance in global markets. In conclusion, while there are signs of a shift in the balance of global reserve currencies, it is premature.
by BitcoinMacro
LOOK AT THAT BEAUTIFUL WTHE MARKET STRUGGLE IS REAL. ACCOUNTS DON'T KNOW WHAT'S REALLY GOING ON. WHEN I POST THE "W" OF THE TVC:DXY YOU WILL SEE AN ASTONING "W AS WELL... BUT ON A LARGER TIMEFRAME. THIS IS ALL JUST A WAITING PERIOD FOR ALL MARKETS TO FINALLY ALIGN AND ATTUNE THEMSELVES FOR THE NEXT PHASE... AND IF TVC:DXY FLOATS AND STAYS ABOVE HKEX:104 THEN ACCOUNTS ARE IN FOR A RUDE AWAKENING. DON'T LISTEN TO ME JUST PAY ATTENTION AND LOOK HARDER BUT IN A MORE... SIMPLE WAY... STEP AWAY FROM THE SCREEN AND TAKE A LOOK. IT IS ALL GLARING AT YOU. Anyway, it's a late night. Off to dreamland. Rest up... we have a long decade ahead. Take care and be safe. #2026Mutation #DXY #BRICS #PETRODOLLAR #HYPERINFLATION #SOUTHAMERICANBANKINGEXECUTIVES #SHIBA #25SIGMA -----------------------------------1-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------0-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------1-------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------------------------------------------------------0------------------------------------------------- Note: Full "W" swing in one twenty-four hour period. Nice job.
COINBASE:SHIBUSD
by NebulousMercuria
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COINBASE:ETHUSDShort
by ModTrades
4
Is this the End of US Dollar Dominance? The US dollar's position as the primary global reserve currency is being challenged as countries become eager to insulate themselves from Washington’s influence. For decades, the dollar has dominated the global monetary system. Currently, about 60 percent of foreign exchange reserves held by central banks are in US dollars, and nearly 90 percent of all currency transactions involve the use of the dollar. However, the dollar's reserve status began to decline in 2014 when some major global powers began to de-dollarize their business dealings. The War in Ukraine, and the subsequent sanctions that it inspired have accelerated the de-dollarization process. For one, Chinese authorities were surprised by the seizure of the Russian central bank's foreign exchange reserves following the Ukraine invasion. In the event of a conflict between the US and China, Chinese assets could also be at risk. Recent de-dollarization events include: During a press briefing at the Davos forum in January, Saudi Arabia's Finance Minister Mohammed Al-Jadaan surprised journalists by stating that the oil-rich nation was willing to consider trading in currencies other than the US dollar for the first time in 48 years. Last week, Chinese and French energy companies completed the first-ever deal on liquefied natural gas (LNG) in China using the renminbi yuan currency. The trade involved the import of 65,000 tons of LNG from the United Arab Emirates and represents a significant milestone in Beijing's efforts to challenge the US dollar's position as the universal "petrodollar" for gas and oil trade. Brazil has also recently announced an agreement with China to trade directly in their own currencies, bypassing the US dollar as an intermediary. India is also making efforts to reduce the US dollar's dominance in international trade by launching separate programs to settle transactions in their own currencies. The Reserve Bank of India recently allowed central banks from 18 countries to open special Vostro Rupee Accounts (SVRAs) to settle payments in Indian rupees. Overall, the US dollar's share of the global market has decreased from 71 percent to 59 percent over the last two decades and could shrink even further in the future. The primary victim in this scenario is the United States, as currency usage in global trade is a zero-sum game. Each time a yuan, real, or rupee is exchanged on the global market, a dollar is not. If credible alternatives gain steam, the dominance of America in the global market will be compromised.
TVC:DXY
by BlackBull_Markets
Long Emerging Markets as the World DeDollarization BloomsAll the empires and dynasties I studied rose and declined in a classic Big Cycle that has clear markers that allow us to see where we are in it. This Big Cycle produces swings between 1) peaceful and prosperous periods of great creativity and productivity that raise living standards a lot and 2) depression, revolution, and war periods when there is a lot of fighting over wealth and power and a lot of destruction of wealth, life, and other things we cherish
AMEX:EEMLong
by noam_chom
2