SiP Posted July 21, 2020 Report Share Posted July 21, 2020 27 minutes ago, fxfox said: EUR/USD broke thru the March high. Monthly chart looks bullish. But keep in mind that there is massive multi year and often tested congestion area between 1.20 and 1.25. Once that is cleared it should fly to 1.50/1.60. When USD falls a lot US stocks become unattractive for overseas investors. Ex-US stocks will become more attractive, also for US-based investors. on weekly, log scale, DXY looks still solid, in uptrend. Link to comment Share on other sites More sharing options...
jp6 Posted July 21, 2020 Report Share Posted July 21, 2020 34 minutes ago, fxfox said: EUR/USD broke thru the March high. Monthly chart looks bullish. But keep in mind that there is massive multi year and often tested congestion area between 1.20 and 1.25. Once that is cleared it should fly to 1.50/1.60. When USD falls a lot US stocks become unattractive for overseas investors. Ex-US stocks will become more attractive, also for US-based investors. If Dollars takes out 94 then Load up on Commodities and EM. Inflation will be back, Fed will doing Yield control just like before Link to comment Share on other sites More sharing options...
fxfox Posted July 21, 2020 Report Share Posted July 21, 2020 15 minutes ago, SiP said: on weekly, log scale, DXY looks still solid, in uptrend. Yes, the multi year downtrend in EUR/USD is not broken yet. btw, I never look at Dollar Index. EUR/USD is the vast majority of the index, The USD index will never move in the complete opposite direction of EUR/USD. Link to comment Share on other sites More sharing options...
SiP Posted July 21, 2020 Report Share Posted July 21, 2020 1 hour ago, fxfox said: Yes, the multi year downtrend in EUR/USD is not broken yet. btw, I never look at Dollar Index. EUR/USD is the vast majority of the index, The USD index will never move in the complete opposite direction of EUR/USD. Yeap. It will mostly move in the same direction as euro but dxy is not only about euro It is a weighted geometric mean of the dollar's value relative to following select currencies: Euro (EUR), 57.6% weight Japanese yen (JPY) 13.6% weight Pound sterling (GBP), 11.9% weight Canadian dollar (CAD), 9.1% weight Swedish krona (SEK), 4.2% weight Swiss franc (CHF) 3.6% weight Link to comment Share on other sites More sharing options...
fxfox Posted July 22, 2020 Report Share Posted July 22, 2020 5 hours ago, SiP said: Yeap. It will mostly move in the same direction as euro but dxy is not only about euro It is a weighted geometric mean of the dollar's value relative to following select currencies: Euro (EUR), 57.6% weight Japanese yen (JPY) 13.6% weight Pound sterling (GBP), 11.9% weight Canadian dollar (CAD), 9.1% weight Swedish krona (SEK), 4.2% weight Swiss franc (CHF) 3.6% weight Yep, that‘s right. But see, EUR/USD is almost 60% of the index. Since it isn‘t an equal weight index that means it is almost impossible that the Dollar index will behave completely different to the move in EUR/USD. The Dollar index is a synthetic product, whereas EUR/USD represents real miney flows. It is not the case that the Dollar index breaks an important level and because of that folks start buying/selling EUR/USD. It is the other way around. The Dollar index is just a gimmic. It is idiotic to construct an index where one single constituent is 58% of the undex. It‘s like if Newmont or Barrick would be 60% of the HUI. Why should you then analyze HUI? You would know that HUI would be behave exactly like Newmont or Barrick. Link to comment Share on other sites More sharing options...
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