Dollar Fall Continues
By Colin Twiggs
October 15, 2009 6:00 a.m. ET (8:00 p:m AET)
The US Dollar Index broke through support at 76, signaling a down-swing to test 74.50*. Recovery above 77.50 is most unlikely, but would indicate that the primary down-trend is bottoming.
* Target calculation: 76 - ( 77.50 - 76 ) = 74.50
The Dow is testing a key resistance level at 10000. Breakout would signal another primary advance, while reversal below 9500 would indicate a secondary correction.
* Target calculations: 1000 + ( 1000 - 900 ) = 1100 and 1000 + ( 1000 - 700 ) = 1300
The euro broke through resistance at $1.48, signaling an advance to $1.50. Reversal below $1.48 is unlikely, but would warn of a weakening up-trend. In the long term, breakout above $1.50 would signal an advance to the 2008 high of $1.60*.
* Target calculation: 1.50 + ( 1.50 - 1.40 ) = 1.60
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The dollar respected short-term resistance at ¥90 and is likely to test the 2008 low of ¥87. Breakout above the declining trendline (and ¥90), however, would warn of a rally to test the upper channel border. In the long term, breakout below ¥87 would offer a target of ¥80*.
* Target calculation: 90 - ( 100 - 90 ) = 80
The Aussie dollar broke through its key resistance level of $0.90 against the greenback, signaling an advance to the upper channel border around $0.98. Expect retracement to test the new support level, but failure of support is unlikely. The long-term target is parity*.
* Target calculation: 0.90 + ( 0.90 - 0.80 ) = 1.00
Know what you want to do, hold the thought firmly, and do every day what should be done, and every sunset will see you that much nearer to your goal.
~ Elbert Hubbard