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11/7/2005
US Dollar index is going for yearly highs against the 92 mark. The rally which started this spring, has really developed into a very nice trend. No one has expected it, everyone tried to fade it. The opposite happened to Euro. Everyone was long into the year and by the time long positions started to liquidate, the downtrend already developed. . Right now, US Dollar is at a VERY important point in the life of the trend (91.5 on the US Dollar Index/1.1950 on the Euro/US Dollar Exchange Rate). If the Dollar manages to stay over the 91.5 (lower than 1.1950 on the Euro Exchange Rate) than the trend still has strength.
Good News for Dollar Bulls: Interest Rates and future Interest Rate hikes are heavily in favor of the Dollar. Not so good news: Speculators are holding near record long positions in the US Dollar Index. This might be a sign of a temporary top.
This is not a trade recommendation and no one should treat it as such.
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Recommended Links on the topic:
US Dollar Index Commitment of Traders Report Euro Commitment of Traders Report US Dollar - Euro 3 month Expected deposit rate differential Implied Eurodollar, Federal Fund, Libor, EuroYen, EuroSwiss, Euribor, Australian, Canadian |
