Posts tagged ‘USD’

The Dollar special

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Jyoti Nangrani, CMT (Chartered Market Technician) from the Market Technicians Association. She has 5 years of experience in Technical Analysis covering Equity and Commodity markets. She holds a Masters diploma in E-Business and is currently pursuing the MS Finance from ICFAI, Hyderabad. She is a Technical Analyst at Finquest Securities Pvt Ltd on the Institutional Desk. She worked as a part of the core strategy team at Tower Capital devising CRM and MIS systems for Debt/Equity and Commodity divisions. She is passionate about Technical Analysis and considers it an extremely valuable skill in current times. Jyoti covers Forex in her weekly columns.


WAVES.FOREX.160709

WAVES.FOREX is a perspective product published TUE and THU. The report highlights the top traded FOREX PAIRS (e.g. Euro, Dollar, Yen, Indian Rupee, Romanian Lei, Swiss Franc and Dollar Index) The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators. REUTER RICS: EURRON=, RON=, JPY=, INR=, HUF=, HRK=, GBP=, EURCHF=, CHFRON=, CAD=, =USD, EUR=

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WAVES.FOREX - JAPANESE YEN POINTS HIGHER

WAVES.FOREX is a perspective product published TUE and THU. The report highlights the top traded FOREX PAIRS (e.g. Euro, Dollar, Yen, Indian Rupee, Romanian Lei, Swiss Franc and Dollar Index) The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

REUTER RICS: EURRON=, RON=, JPY=, INR=, HUF=, HRK=, GBP=, EURCHF=, CHFRON=, CAD=, =USD, EUR=

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WAVES.FOREX - EURHUF - HUNGARIAN FORINT READY TO REVERSE

WAVES.FOREX is a perspective product published TUE and THU. The report highlights the top traded FOREX PAIRS (e.g. Euro, Dollar, Yen, Indian Rupee, Romanian Lei, Swiss Franc and Dollar Index) The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

REUTER RICS: EURRON=, RON=, JPY=, INR=, HUF=, HRK=, GBP=, EURCHF=, CHFRON=, CAD=, =USD, EUR=

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THE DOLLAR SENSEX

There are stories about the inverse correlation between SENSEX and the US Dollar Index (USD). The same stories which talk about inverse correlation can also explain perfect correlation, but there is something missing here. First, perfect correlation does not last. Second, if instead of absolute prices if we compare changes between prices, the idea of correlation adorns a new meaning. For us at Orpheus it is not about positive or negative correlation, it is about the cycle of correlation.

The question of when DOLLAR strengthening against SENSEX will start or vice versa is more important than the obvious fact that dollar strengthening affects Sensex inversely. SENSEX pushed 17% higher in dollar terms compared to INR. This was a result of INR weakness against the dollar that was reflected in SENSEX returns.

According to performance cycles, an asset will always outperform or underperform the other asset. This means that there will always be an inverse correlation between any pair of assets if you are comparing performances. So what matters is really not correlation, but which of the assets is outperforming the other and WHEN.

In continuation of the above view we continue to look lower on SENSEX. The current downmove looks like an impulse which should push prices back till open gap levels.

We highlighted a Head and Shoulders pattern on SENSEX and Double Top pattern on NIFTY and BSE OIL. The current report also carries ANTICIPATED AND HAPPENED cases on NIFTY, CNXIT and BSE REALTY, as well as time oscillators updates. Our overall Indian market view remains negative.

Enjoy the latest WAVES.INDIA

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ORPHEUS INDIA RESEARCH WAVES.IND is a perspective product published on Tuesday and Thursday. The report highlights Indian Stock Market top sectoral Indices and Sensex (BSE 30) viz. BSEOIL, BSESC (Small Cap), BSEMC (Mid Cap), BSEHC (BSE Health Care), BSEPHARMA (Pharmaceuticals), BSECG (Capital Goods), BSEBANK (Banking), CNXIT (Technology), BSEFMCG (FMCG), BSEAUTO (Auto) etc.. The product also covers all the 30 Sensex components. The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools, sentiment indicators and other alternative research tools like INTERMARKET to spot outperformers.

COVERAGE: REUTERS RICS. INDICES. .BSEBANK, .BSEOIL, .NSEI, .BSECG, .BSESN, .BSEAUTO, .CNXIT, .NSEBANK, CITc1, IFc1, .NSEBANK

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EURUSD. The large primary degree B wave continues to unfold

Enjoy the latest WAVES.FOREX.

WAVES.FOREX - WAVES.FOREX is a perspective product published TUE and THU. The report highlights the top traded FOREX PAIRS (e.g. Euro, Dollar, Yen, Indian Rupee, Romanian Lei, Swiss Franc and Dollar Index) The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

REUTER RICS: EURRON=, RON=, JPY=, INR=, HUF=, HRK=, GBP=, EURCHF=, CHFRON=, CAD=, =USD, EUR=

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EURUSD. NINE LEGS UP SUGGESTS A COMPLETE C/3 UP.

Enjoy the latest WAVES.FOREX.

WAVES.FOREX - WAVES.FOREX is a perspective product published TUE and THU. The report highlights the top traded FOREX PAIRS (e.g. Euro, Dollar, Yen, Indian Rupee, Romanian Lei, Swiss Franc and Dollar Index) The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

REUTER RICS: EURRON=, RON=, JPY=, INR=, HUF=, HRK=, GBP=, EURCHF=, CHFRON=, CAD=, =USD, EUR=

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The Dollar cycles - II

We captured the move up on EURUSD from 1.32 levels to the current 1.37 levels. Now the question is whether EURUSD will reach 1.4 levels and continue to push higher or is the pair in a larger sideways action as illustrated by us in the dollar cycles (25 MAR 09).

The illustrated Japanese YEN continues to move in a corrective accompanied by an over reactive momentum. This suggests that JPY should bottom soon after which the pair should push higher against the dollar back to 100 levels. This suggests a minor negativity on EURUSD followed by an intermediate positivity. In other words 1.4 -1.45 could be a best case for the EURUSD. After which EURUSD should push back. Even the move on EURUSD looks faint and incapable to move above 1.39-1.4 levels in the ongoing formation (Slide 5,6,7).

Both HRK (Croatian Kuna) and HUF (Hungarian Forint) seem to be following a similar trend, minor up but intermediate down. All this suggests that our view on DOLLAR in a large primary corrective could be valid.

GBP has also hit the primary cycle low against dollar and any dip down on the pair should be the last bout of weakness before the pair reverses.
We have updated the latest forex report with USDCHF and anticipated and happened cases on EURRON and INR.

Enjoy the latest WAVES.FOREX.

WAVES.FOREX - WAVES.FOREX is a perspective product published TUE and THU. The report highlights the top traded FOREX PAIRS (e.g. Euro, Dollar, Yen, Indian Rupee, Romanian Lei, Swiss Franc and Dollar Index) The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

REUTER RICS: EURRON=, RON=, JPY=, INR=, HUF=, HRK=, GBP=, EURCHF=, CHFRON=, CAD=, =USD, EUR=

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THE DOLLAR CYCLES

During a telecon, a senior MTA member and my mentor Rona Schehrer from Zurich remarked that markets move around a few key assets. And inability to miss out on one can imbalance any sound portfolio. What Rona was mentioning was that even she could generate real alpha, she still had to understand Forex risk. The wild movements in dollar made a fund managers already tricky task trickier.

I promised her to have a detailed look at Dollar Index, so here goes. We have studied the inverted dollar index in this report. Inverted dollar index (=USD) is similar to the Euro Dollar (EUR=). Despite a comprehensive attempt to study Dollar cycles, we could not make an immediate secular case of weakness on Dollar. What we could see was a broad stagnation on dollar for 12-15 months, followed by further strength at least till late 2010. Only after which the next round of secular dollar weakness should begin.

We could be interpreting the cycles incorrectly, but if what we see is correct, then it’s not over for the paper assets. DOW and Global equity has a large bout of strength left. This should be good news for battered equity bulls and bad news for the crisis believers (majority now). This
also means that Gold collapse is more real than what seems. The fool’s gold is trapping as many bulls as it can.

On the minor and intermediate terms, dollar index could push up till 92 (previous 4 levels). After which the large multi month stagnation should unfold. The latest WAVES.FOREX carries other Anticipated and Happened cases on INR and RON Dollar. Euro Ron triangle is fizzling out. We are still expecting a leg up on Euro Ron before the multi month strengthening starts on Lei. If majority of world assets are against dollar and markets core competence is to confuse and surprise, the large multi month dollar stagnation we are talking about is at the right time.

Enjoy the latest WAVES.FOREX

WAVES.FOREX is a perspective product published five days a week. The report highlights the top traded FOREX PAIRS (eg. EURO USD, DOLLAR INDEX, YEN USD, Indian Rupee, Romanian Lei, Swiss Franc, Hungarian Forint, Croatian Kuna, Canadian Dollar). The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

ORPHEUS GLOBAL RESEARCH

WAVES.FOREX is a perspective product published twice a week. The report highlights the top traded FOREX PAIRS (eg. EURO USD, DOLLAR INDEX, YEN USD, Indian Rupee, Romanian Lei, Swiss Franc, Hungarian Forint, Croatian Kuna, Canadian Dollar). The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

REUTER RICS: EURRON=, RON=, JPY=, INR=, HUF=, HRK=, GBP=, EURCHF=, CHFRON=, CAD=, =USD, EUR=

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The Gold Dollar

The gold dollar was a United States dollar coin produced from 1849 to 1889. Composed of 90% pure gold, it was the smallest denomination of gold currency ever produced by the United States federal government. When the US system of coinage was originally designed there had been no plans for a gold dollar coin, but in the late 1840s, two gold rushes later, Congress was looking to expand the use of gold in the country’s currency. The gold dollar was authorized by the Act of March 3, 1849, and the Liberty head type began circulating soon afterward. Because of the high value of gold, the gold dollar is the smallest coin in the history of US coinage.

The gold dollar link is divine and stands till date. There has been only one prior instance since 2004 (2) when Dollar and Gold strengthened together. The current situation (6) is also witnessing a move up on DOLLAR index and Gold simultaneously. Conventional thought may find it perplexing how this could happen. But just like everything, correlation is cyclical. There is high correlation, low correlation and negative correlation between two assets. This is what is happening between DOLLAR and GOLD. The negative correlation of past years is moving to a positive correlation. But then paper and hard assets can not move in sync for long. This is why one of the assets has to give in. Either Dollar should stop strengthening or Gold should come down.

One would say why this positive correlation can not last for some more time. Yes it can, but now that both dollar index and Gold are heading towards historical highs, we are reaching inflexion points where we could see this positive correlation break down. A gapping USD only confirms that inflexion point might be near.

Our Gold topping view hence is under pressure. It was under pressure since Gold broke above 900. We were singly negative on Gold and positive on all the rest of the metals. We illustrated many reasons to validate our view, but Gold continued to break all our projected resistance levels starting 900, 940 and now is pushing higher to psychological 1000 levels. A breakdown in the DOLLAR-GOLD parity is what will give us further confirmation. A turn down on dollar here would suggest that Gold is indeed heading higher and any dip from current levels will not take us to new intermediate lows. While a break on dollar to new highs would keep us on our preferred negative view on gold.

On the negative side, time oscillators continue to suggest a topping Gold than otherwise. Any dip from current levels could see prices pushing lower till end of Feb, early Mar.

We have carried anticipated and happened cases on PLATINUM, SILVER and SILVER INDIA spot. We were positive on PLATINUM since 800 levels and now it has broken psychological 1000 and headed higher. ZINC and COPPER are at key supports. Our ‘screaming buy’ view on ALCOA stands challenged now that it is retesting previous lows. Though the prices held above anticipated supports, they failed to push higher. A break at previous lows would be negative. We will review after prices push back above respective levels. Overall, the metals case seems a bit overstretched now and if Gold had a tough time turning down, exhausting trends on rest of the metals should see some supply pressure coming in across the board. But till that happens Gold 1,000 could be some news to watch. At this stage we remain ‘Up and Topping’ on the metals complex.

Enjoy the latest WAVES.GOLD

REUTERS RICS: XAU=, XAG=, XPT=, CU-NYC, .SPGSIZ, SPGSIA, .NSTL

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