Dollar analysis and movement
Updated
I gave my last analysis on Gold which explains the fundamentals and technicals of where I expect to buy gold in other terms when do I expect gold to drop and pick back up. This dollar chart is completely aligned with that idea as well. To quickly summarize my view on Dollar though, I expect DXY to move higher as I believe we're not getting any cuts this year at least not until 2025 and I also believe other central banks such as the BOE and ECB will start cutting before the FED meaning in this high inflation environment in the USA, the dollar will maintain its strength as investors will continue to move tho that currency. Many other factors are taken into account here such as political and geopolitics but this is the main impact I wish to concentrate on. Something very important to mention as well is the amount of money that was injected in the US economy, it is a never seen before situation that is being manifested in this sticky inflation we've been seing for the last several months. Anywho, those are my thoughts mixed with the technicals above, Let me know what you think.
Note
Looks like we had a first catalyst with Jobs coming in pretty good that took DXY in the direction we analyzed. Thus far, the data is making it hard for the FED to consider a cut. I mean on that same Friday before market open, the market went from not expecting a cut in July to start considering a cut in July and now obviously the market is no longer considering that idea after NFP came in very hot, what a week!!!. Next up is the FOMC meeting on the 12th along with CPI on that same day. Anything equal to or 0.1 below the current 3.4 won't move much given that it wouldn't be enough to entertain a strong consistent move to the downside. However anything above will really boost dollars and introduce a question mark on if the policy is tight enough. Depending on those results as well, Jerome Powell will align his tone. Good luck to all and let's see if DXY will reach that 106.900 - 108.00 level.Note
We are moving as expected within the identified channel and that is boosting our USD pair positions. Check out the GU idea for more. 106.900$ will be the critical level to break. So we will be monitoring to see how price reacts there and of course we are watching closely the data prints and the global geopolitical situation to gauge that dollar strength. I'll like to add that we will soon be stepping into S2 2024 so it's all about mitigating risk and securing profits. If we're talking Forex, USD is the strongest currency at the moment and will solidify its strength for the rest of the year as porfolios consolidate and lower risks.
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