As you have seen, I haven’t posted anything since Christmas and plan to take these couple of weeks between Christmas and the first full week of January off. Long time subscribers know that I rarely take days off but am taking the opportunity this year.
I like to use holidays as an opportunity to research a little and to come at things with fresh eyes. Something that I have been thinking about is the dollar. My primary count is broken so what is going on? I know that it is popular to talk about the death of the dollar but I’m skeptical. I also think that equity indices are very overbought and can have a pretty substantial retrace or more next year. Given that I think there are significant headwinds in the equity indices, I still think DX will get a flight to safety bid on any equity weakness. I’m still thinking about it, but maybe something like this is playing out. Here is a monthly chart of UUP, the USD ETF.
Wish all of you a happy, healthy, and prosperous New Year.