US Dollar Index - Charted

I saw what may be an interesting chart pattern on the $USD index, thought I would share it with you. Looking at the five year monthly chart there appears to be a very bullish pennant on a flagpole formation. It looks like it is about to take off. Let's see what happens.

Don't agree or disagree with it, but this is my problem with patterns such as these:

One could make an equally convincing case for a double top that will "confirm" soon and thus be bearish.



Btw very cute to hide your name on the chart !

minwa said:

Don't agree or disagree with it, but this is my problem with patterns such as these:

One could make an equally convincing case for a double top that will "confirm" soon and thus be bearish.

Btw very cute to hide your name on the chart !

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G'day minwa, thanks for commenting! Looking at charts is no science, it is all in the eye of the beholder. However there are certain patterns that repeat and once you become familiar with them you can call it fairly easily. Now whether they will resolve the way they are supposed to well that's another thing!

Just to make this chart a bit clearer, I have looked at it in the single line closing price to keep it simple and with less noise, I often will draw a chart using the simple line and then flick back to pretty candles. But I just want it to be a clear view this time.

Double tops are quite distinct, they need a bit of history between peaks but having said that, if you are day trading, a double top on the same day can be just as likely to resolve as a double top on a twenty year chart. It is all a matter of scale. My chart is a twenty year chart set monthly. So much more time is required for a double top call. Hope that makes sense?

You are the very first person to comment on my name, well spotted!

So far the pennant on the flagpole pattern is resolving as was expected by clearing the pennant with great upward momentum. Now let's watch and see if it can keep going and if so will it form a second flagpole with either a flag or pennant? The $USD may be the place to be, let's see!

Ann said:

So far the pennant on the flagpole pattern is resolving as was expected by clearing the pennant with great upward momentum. Now let's watch and see if it can keep going and if so will it form a second flagpole with either a flag or pennant? The $USD may be the place to be, let's see!

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Thought we might get a slight pullback Ann, just on the 60m it was at the top of the channel, take us into NFP on Friday maybe...

thank you:1zhelp:

CanOz said:

Thought we might get a slight pullback Ann, just on the 60m it was at the top of the channel, take us into NFP on Friday maybe...

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Absolutely right CanOz! It got a right knock on the head with the a long term overhead resistance trendline coming from 2001. Let's see how it handles the old overhead. I would like to see a fallback and retest if it gets above around the $99 level and then the channel range up to $100 needs to be broken through....a retest back would also be nice but the retest may not happen in the excitement! On the down side if it fails it may fall back to around $93.

I'd say the USD is going to head down for a bit now and the Eur/Usd is a long

Eur