From the desk of Steve Strazza @Sstrazza

Last Week, we held our November Monthly Conference Call, which Premium Members can access and rewatch here.

In this post, we’ll do our best to summarize it by highlighting five of the most important charts and/or themes we covered, along with commentary on each.

Let’s get right into it!

This is the video recording of the November 2023 Mid-month Conference Call.

From the Desk of Ian Culley @IanCulley

The dollar has gone from slinging cheese to lobbing cookies.

Sellers finally got ahold of the US Dollar Index $DXY on Tuesday, sending it on its steepest single-day decline since October 2022.

Recall what followed for the dollar…

The DXY formed a major top and fell victim to not one but two subsequent 1 percent-plus daily drawdowns. 

Check out the DXY chart with the one-day rate-of-change in the upper pane:

The DXY dropped almost 1.5% during Tuesday's session. That’s a huge move for a currency (with the exception of the Turkish lira and perhaps the Polish zloty).

Based on the action witnessed last fall, it wouldn’t be surprising for the DXY to experience a reprieve from selling pressure in the coming days, followed by renewed downside action. 

As I mentioned last week, “If and when it (the DXY) falls below...

From the Desk of Ian Culley @IanCulley

The US Dollar Index $DXY is still dealing like an old-school ace on the mound.

I don’t care what stock market bulls or technology investors want to believe.

The buck has been lights out since July.

And just because it found itself in a bit of trouble last week doesn’t mean it can’t retire the side…

The index pulled back to a key retracement level at approximately 105 on Friday:

Unsurprisingly, the dollar bore down at this critical area as it coincides with a logical support zone. 

But, when we take a closer look… 

Sellers are digging in, seeing the spin on the ball, with runners in scoring position.

Check out last week’s breakdown:

The DXY undercut the January and March pivot highs from earlier this...

A lot has been made about the underperformance from small-cap stocks this year.

The permabears in particular really enjoy using this one as an excuse for missing out on one of the most epic rallies in market history

"But the small-caps"....they cry.

So yes, let's address it. How about those small-caps?

Zoom out. It's a clean series of higher highs and higher lows:

This is the video recording of our November 1st Monthly Charts Live Strategy Session

From the Desk of Ian Culley @IanCulley

The Bank of Japan is loosening its grip on the Japanese benchmark yield.

And the dollar, the euro, and the pound are ripping to fresh highs versus the yen.

Yes, the USD/JPY is off to the races – again.

But where can we define the next logical upside objectives?

Let’s dive in…

Before tackling our targets for the dollar-yen pair, check out the Japanese 10-year yield:

The BoJ’s yield curve control policy has, in large part, capped the USD/JPY rate as traders and policymakers play a game of chicken. Traders drive the dollar-yen pair higher, challenging the Japanese central bank's hold on interest rates.

Meanwhile, the BoJ steps in with policy decisions supportive of the yen.   

Market participants were expecting the move from the BoJ today – which it did by loosening its grip to 1.00% as an upper bound for the 10-year yield.

But it wasn’t enough in the eyes of the market as the EUR...

From the Desk of Ian Culley @IanCulley

Economists, columnists, and pundits are calling for an economic recession and even the possibility of deflation. 

Yet the US dollar is consolidating above a critical support zone.

Nothing bearish about that!

In fact, it’s standard price behavior within an ongoing uptrend. 

Sure, the pundits might be right. But both scenarios involve a swift decline in the US dollar.

And that’s simply not what’s happening today.   

In fact, forex markets are providing new opportunities to buy US dollars and sell other major currencies…

Check out the EUR/USD pair pulling back to a logical resistance level:

If you missed selling the breakdown in September, the market is giving you another shot.

The EUR/USD is...

From the Desk of Steve Strazza @Sstrazza

Monday night we held our September Monthly Conference Call, which Premium Members can access and rewatch here.

In this post, we’ll do our best to summarize it by highlighting five of the most important charts and/or themes we covered, along with commentary on each.

Let’s get right into it!

Gold has leaned sideways to lower lately.

The US dollar and interest rates continue to rise, creating unfavorable conditions for the yellow metal and its crazy cousin, silver.

As long as those trends remain intact, precious metals will struggle. And they have... until very recently.

Regardless of the broader intermarket landscape, I can't ignore near-term strength for these shiny rocks...

From the Desk of Ian Culley @IanCulley

The US Dollar Index $DXY is chopping smack-dab in the middle of a three-week range.

Currency markets are quiet. The euro, the pound, and the yen have all dialed back the volatility.

But there’s nothing wrong with the sideways action.

And in no way does it diminish the underlying uptrend for the dollar. 

In fact, the near-term trendless range makes sense in light of DXY’s recent run and the long-term support levels in play for major currencies.

Check out the DXY with the number of consecutive up weeks in the lower pane: 

Eleven weeks in a row! The index climbed higher for almost three straight months. 

A period of consolidation not only makes sense but politely adheres to the law of gravity.

Sorry, but price doesn’t move in a straight line – even for the dollar index.

...

This is the video recording of the October 2023 Mid-month Conference Call.