Tuesday, November 08, 2005

The US Dollar Topping Pattern - II

Here is how the dollar looks after Monday, November 8:
A futures chart

The double top to the right hand top failed. The head and shoulders right hand top failed. Then a bullish upside down head and shoulders developed and the dollar went into new highs for this rally. Still, two end of upward trend signals got generated. This is bearish for the dollar even if they failed.

A double top can still be developing. A higher right hand top can be a final strong test/shake out of any weak shorts still left in the market. When there is a bullish double bottom in a market, the ideal bottom is when the right hand bottom goes lower than the left hand bottom which is a final shake out of weak longs. Same goes for the inverse.

The dollar is up 3 days in a row as of Monday. If it closes up a 4th day, that would be bearish for the dollar since that would be an end of upward trend signal.

The dollar is also up near the top of its upward sloping channel. Bearish.

Gold is definately down in over sold territory.

I'm still very bearish on the US dollar.

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