We’ve been keeping a close eye on the US dollar, which as a safe haven, continues to move inversely to equities. I remember reading Aftershock a couple of years ago. It made the very convincing argument that the US dollar would be destroyed by disastrous fiscal policy and runaway debt.
The advice was to dump everything into euros and ride out the coming storm. Needless to say, this otherwise terrific book demonstrated the risk of putting any investment advice into writing — a fear I battle on a daily basis.
DX has been in a huge falling channel for years — a fact many dollar bears have duly noted.
Since 2005, however, the major direction within the channel has been a slightly downward sloping sideways movement (the white channel lines.) We’re currently working on our third thrust up within that system — shown by the small purple channel over the past 2 years.
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