The charts above are of the Chinese Renminbi and of the US dollar.
US Dollar: It has been in a long term downtrend. Recently, a bearish head n shoulders pattern has been emerging. In this right shoulder formation period, commodities are getting hammered. Ofcourse, the inverse correlation doesn't hold steadfast on every trading day, but in the long term - dollar down means commodities up. So when can we see the dollar resume its fall?
We believe that the dollar index can rise upto 73-74 region (corresponding to the UUP in 23 region), once the UUP breaks the neckline, we can see a dollar plunge, probably corresponding to another dip in the markets. By this picture, this could take another month or so.
Renminbi: Contrary to the dollar, the renminbi chart is looking bullish, it is in a gentle uptrend, with an upward slope of appreciation rate of over 7-8% for an year. If only our 401K were denominated in chinese Renminbis, instead of in dollars.
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