The $USD is now at a very critical level. Having recently met its downward target of 89 based on a Head & Shoulders or H&S pattern (see chart above), it is now testing its horizontal support. With a price/MACD divergence, it looks likely that it will go up. However, to confirm this change in direction (i.e. upwards), the RSI should bounce back up from its oversold level of 32 (or below). A buy signal would be given if the price moves above the 50dMA (for the short-term) and 200dMA (for the long-term). If it does not bounce up from here, it's next target will be around 80 as mentioned in my previous post here:
https://steemit.com/marketreport/@jmsm2/us-dollar-and-gold-is-the-usd-about-to-collapse-and-gold-about-to-rise
If it does bounce back up, this would be in line with a recent prediction by the well-known cycle analyst, Charles Nenner. It would be very interesting to see if Gold then moves in the opposite direction (as it usually does) or if we're now going to witness both USD and Gold moving in the same direction (which is very rare but a significant development). So, I'll be keeping a very close eye on the USD and Gold and will update this analysis when their trends are clearer.
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DISCLAIMER: I'm not a financial adviser, nor a professional trader and nothing I say here is meant to be a recommendation to buy or sell any financial instrument. It is purely for educational purposes. Don't invest money you can't afford to lose. Always do your own due diligence before trading or investing.
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Update on 15-Mar-18: As forecast above, the $USD did bounce back-up (as a result of the divergences mentioned above) from around 88 to its current level at 90. It is now hitting the underside of the 50dMA at 90.1 and If it does not overcome this critical resistance and turns back down, then USD could be in big trouble. The next few days will be critical in its future direction. This is definitely one of the most exciting times in my charting career !
Update on 26-Mar-18: The $USD found it difficult to move above the 50dMA resistance and has now fallen to 89.03 which is not surprising due to the news overnight from China about the Yuan replacing the Petrodollar. Looks like it is going to visit the next support level around 80 now. This is a major development for the USD reserve currency but could be very positive for the precious metals.
Update on 6-Apr-18: The $USD moved up decisively above its 50dMA (blue line) yesterday at around 90 which was a key resistance. If it can stay above this blue line, it would be a very bullish move for the reserve currency, at least in the short-term and if it can move above its 200dMA (currently around 92.5) and stay above it, it could even form a strong uptrend. This may surprise many people especially if Gold and Silver also start going up at the same time.
So, the key levels to watch are the 50dMA (blue line) and 200dMA (red line) and whether the $USD stays above or below these lines (see chart below). If it falls below the blue line again and stays below it, then the days of the USD as a reserve currency are likely to be numbered !
Update on 26-Mar-18: The $USD found it difficult to move above the 50dMA resistance and has fallen to 89. This is not surprising based on the news from China today about the replacement of the Petrodollar with the Yuan. The next target is likely to be around 80 which is a major development for the USD reserve currency. If 80 does not hold, then USD could be toast. This development looks very positive for the precious metals though.
Update on 6-Apr-18: The $USD moved up decisively above its 50dMA (blue line) yesterday at around 90 which was a key resistance. If it can stay above this blue line, it would be a very bullish move for the reserve currency, at least in the short-term and if it can move above its 200dMA (currently around 92.5) and stay above it, it could even form a strong uptrend. This may surprise many people especially if Gold and Silver also start going up at the same time.
So, the key levels to watch are the 50dMA (blue line) and 200dMA (red line) and whether the $USD stays above or below these lines. If it falls below the blue line again and stays below it, then the days of the USD as a reserve currency are likely to be numbered !