The Dollar

The dollar printed a bearish reversal on Friday.



The big picture is that the dollar is very late in its timing band for a yearly cycle decline and formed a bearish weekly reversal on week 5 to set up a potential left translated weekly cycle formation.  A left translated daily cycle formation would align with the dollar declining into an intermediate cycle low.  The bearish reversal on day 8 sets the dollar up for a potential left translated daily cycle formation. Still, the dollar is in a daily uptrend.   The dollar will remain in its daily uptrend unless it closes below the lower daily cycle band.



The peak on week 5 aligns with a left translated weekly cycle formation.  The dollar formed a weekly swings low this week which allows us to construct the weekly trend line.   A break below the weekly trend line will confirm the intermediate cycle decline.  So if the dollar has begun its intermediate cycle decline, then a bearish reversal on day 8 aligns with an intermediate cycle decline.   However, the dollar currently is in a weekly uptrend.  The dollar will continue in its weekly uptrend unless it closes below the lower weekly cycle band.



Stocks could not break above the 50 day MA and broke lower to back test the day 44 low. 



Stocks backtested the day 44 low on Thursday.  Stocks went on to form a swing low and closed above the 10 day MA on Friday.   Therefore we will label day 44 as the daily cycle low, making Friday day 9 for the new daily cycle.    Stocks have begun to close below the lower daily cycle band indicating a daily downtrend.  Stocks will remain in their daily downtrend unless they can close back above the upper daily cycle band.  And a daily downtrend is associated with being in an intermediate cycle decline.



This was week 10 the intermediate cycle.  The peak on week 7 followed by closing below the 10 week MA indicates that stocks are in an intermediate cycle decline.  However, stocks are caught between the 10 week MA and the 50 week MA.  Unless there is some type of major intervention from the Fed, stocks will likely continue their intermediate cycle decline.  Stocks will need to either close above the 10 week MA or below the 50 week MA in order for a trending move to develop.  Currently, stocks are in a weekly uptrend. If  a weekly swing low forms above the lower weekly cycle band then stocks remain in their weekly uptrend.

Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at are those of the individual authors and do not necessarily represent the opinion of or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.

Analysis feed

Latest Forex Analysis

Editors’ Picks

Euro rolling into the Asian session below the 1.1050 level

The shared currency, on the daily chart, is trading in a bear trend below the main DSMAs. The Euro has been in a trading range over the last two weeks as the market participants are waiting for a catalyst.


GBP/USD: 3-week-old resistance-line questions 100-DMA breakout

Successful trading beyond 100-day simple moving average (DMA) fails to lend much strength to the GBP/USD pair as it struggles around 1.2520 during Friday morning. A rising trend-line since August-end, seems to challenge buyers.


USD/JPY flat in Tokyo opening hour, bears eye break below 107.45.

USD/JPY is flat in the Tokyo opening hour as we wind down into the close for the week following a data-heavy number of sessions which have left more questions unanswered and the outlook murky. 


The Federal Reserve Keeps its Options Open

The Federal Reserve’s two rate cuts in as many months have satisfied market expectations for action and will give the governors time to determine if a full reduction cycle is warranted.

Read more

Gold consolidating at technical levels awaiting next catalyst

Precious metals were higher on Thursday. Gold prices climbed from $1,489.13 to $1,504.60. The gold ratio travelled between 83.87 and 84.66 with a bullish bias as the yellow metal surges on. 

Gold News

Forex Majors