Too many dangerous dollars on handsFundamentals & Sentiment
WTI:
In general, there are global drivers for oil demand, amongst them is supply curbs from OPEC. More recently geopolitical risks in Middle east create bias for oil upside.
USD: The dollar has been overbought according to CFTC reports. The risk of BoJ intervention is still there, so it's better not buy dollars anyhow as long as USDJPY is near 155. Also, today's US MoM Retail Sales are expected to be worse than last month - a good environment to trade into the event.
If the Retail Sales come out stronger than expected, it's better to close the position or tighten stops.
Technical & Other
- According to seasonals DXY should stay flat for the next 3 weeks
- WTI sold off sharply on Friday, so the mean reversion of that move makes sense.
Setup: TC(RTF)
Setup timeframe: 4h
Trigger: 1h
Medium-term: UP
Long-term: Uptrend
Min target: range highs
Risk: 0.77%
Entry: Market
Shortusd
AUDUSD cleared mean VWAP in bullish momentum LONGAUDUSD as shown on the 30-minute chart has crossed over the mean VWAP anchored back 5
days. From here I expect a move toward the upper first and second VWAP lines and so will
take a long trade targeting 0.6535 initially ( aVWAP+1) and 0.655 for the higher target ( aVWAP
+2) The stop loss will be under the mean VWAP at 0.6515.
USD/CAD short emerging from Rev Inv C&H with target 1.2900There are many different variations of patterns showing.
And they are all leading to downside.
We have small Rounding Tops, small Inverse Cup and Handles.
We have a break in the most recent uptrend line..
But I am focusing more on the bigger picture.
There is a solid Reverse Inv Cup and Handle forming since 10 August 2023.
The price has almost completed the final Inverse Cup and is approaching the brim level.
We have other indicators confirming with 21>7 - Bearish in the short term.
We also have the price coming down to test and mighty 200MA.
Break below, and it'll give us more confirmation of downside to come.
RSI is falling below 50 like a knife, showing downside momentum.
All in all, my first target will be at 1.2900
PS: This also goes in line with the overall DOllar weakness that has helped boost the stock markets world wide and the indication of a slow down in interest rate hikes.
Great for stocks not great for the US dollar.
DXY Spike Up Yesterday Only to Spike Down TodayThe USD is showing some terrible weakness today after going up strongly yesterday. It could be due to the better than expected down on oil inventory which stimulated demand for USD and lessen fears of recession forcing down a Fed rate hike. So the USD strengthen yesterday on 26 Apr 2023. Now on 27 Apr 2023, the USD Strength seems to have reversed. The long EURUSD trade seems like a good vehicle to go long the USD.
Long SLV. Silver to shine as dollar bounce wanes. The dollar is in a secular downtrend and after a brief bounce back which we played on the long side, the DXY is looking toppy and should continue to rollover in the intermediate term. Besides stocks, a beneficiary of a weaker dollar are the precious metals. I like long SLV as a high beta trade and expect SLV to continue to bounce higher in the coming weeks.
Developing A Dollar Bearish Strategy Using The Scientific MethodShould I Short USD? Yes or No?
If yes, then how? If no, then why?
The question is simple, but the answer may be complicated.
Therefore, we will dive into the macroeconomics of the American economy, with consideration given the most significant factors influencing the value of USD.
> OBSERVATIONS
1) Since March 2020, USD appears to have lost approximately 13% of it's market value.
2) Since March 2020, USD supply increased by $9.1 Trillion (COVID stimulus).
datalab.usaspending.gov
3) Congress was recently asked to approve an additional $1.9 Trillion (COVID stimulus).
context-cdn.washingtonpost.com
> RESEARCH
Part A: Three major external factors contribute to the value of USD...
www.investopedia.com
1) Supply and demand:
Exporting American products and services creates demand for USD, because foreign investors must exchange their currency for USD, in order to complete the transaction.
Note: decreased exports = decreased demand = decreased USD value
Note: decreased stock/bond issuance = decreased demand = decreased USD value
2) Sentiment and market psychology:
Rising unemployment weakens the economy, reduces income, and slows consumption. If the US economy appears weak, foreign investors may sell-off their US securities, in favor of exchanging back to their national currency.
Note: decreased employment = decreased consumption = decreased USD value
Note: negative sentiment = decreased foreign investment = decreased USD value
3) Technicals:
The release of government statistics (payroll data, GDP data, etc.) may help quantify whether the economy is strong or weak. Historical patterns generated by cyclical support/resistance levels and technical indicators also contribute to the movement of USD.
Gross domestic product (GDP) is the total value of all the finished goods and services produced (in this case, within American borders)
www.investopedia.com
Note: decreased employment = decreased GDP = decreased USD value
Part B: Four major internal tools (utilized by the Fed) contribute to the value of USD...
www.federalreserve.gov
1) Discount rate:
The interest rate reserve banks charge commercial banks for short-term loans.
2) Reserve requirements:
The portions of deposits that banks must hold in cash in vaults or on deposit.
3) Open market operations:
The buying and selling of U.S. government securities (T-bills, bonds, and notes).
4) Interest on Reserves:
The interest paid on excess reserves held at reserve banks.
> HYPOTHESIS
Shorting USD will be profitable because the Fed is increasing money supply.
Shorting USD will be profitable because the Fed is maintaining interest rates near zero.
Shorting USD will be profitable because the Fed is maintaining reserve requirements at zero.
Shorting USD will be profitable because the Fed is repurchasing government bonds on the open market.
> EXPERIMENT
Part A: Build a diversified dollar bearish portfolio.
Include dollar bearish securities and commodities (FXC, FXE, UDN, GLD, IAU, DBC, DBP)
Include International stock and emerging markets ETFs (open to all suggestions for this)
Include foreign currencies (GBP, CAD, AUD, CNY, CHF, KRW, JPY, EUR)
Include crypto currencies (BTC, ETH, LTC, and especially the DeFi sector)
> RESULTS
Pending... follow me for a monthly update to see if I get rekt, much love!
SHIB Bullish on the 1 hour with volume 0.003 penny per SHIB nextThis is Elon's coin. He's peppered easter egg type of clues all over the place if you follow up. In one place, he's saying he'll name a moon rocket after the coin. It's not for the money. It's for the cause and fun!
The aim of SHIB is a stable state, after coin burn to reduce the "remarkable but unsustainable" market cap, this is a SHORT FIAT! robinhood stock that's about to get listed on the popular platform.
DXY Trend Direction Breakdown - Aug. 2nd, 2021DXY confirmed bearish on a break of 91.980. Using structure to determine 90.581 as my current farthest short target, with multiple levels/zones to pass through first; shorts started around 92.186. Price retests and ranges within 92.186 - 92.333 are stuck in a zone that I personally will not attempt to trade within. The bullish trend was held above 91.800 at first, and just recently adjusted higher to 91.980, which weakened the overall previous trend and caused me to switch to a bearish bias. My personal new long orders would start around 92.333 with the current farthest target being 93.088, with multiple levels/zones to pass through. Analysis referenced the daily, 4h, 1h, with 4h being the main reference.
Buy GBPUSDOnly entering this trade if we have a bullish engulfing over asian session candles.
I do 300-500 pips a week. Telegram Signals in bio.
Quick enter and exit trade for 30-100 pips.
Market psychology. The banks and firms do exactly the opposite of what the retail traders do. That's how they make their money. This, if criteria are met, will be the perfect example.