The US Dollar has been moving higher for nearly a decade, as the trend is up. Could the trend be changing? Could King Dollar lose strength here? If King Dollar would turn lower, what opportunities will present themselves?
Below looks at a chart of the US Dollar over the past 30-years, on a “Monthly Hi/Lo/Closing” basis-
CLICK ON CHART TO ENLARGE
The US Dollar finds itself in an uptrend and testing the underside of dual resistance at (1). With the trend being up, if King Dollar would breakout at (1), the patterns would suggest that it could run to the upside a good deal. .
Seeing the US$ testing the underside of “Two” long term channels at the same time, creates the potential that the US$ could peak at these levels. Potentially this could become an 800 pound resistance gorilla for the Dollar.
If support would happen to be taken out at (2), it would suggest US$ weakness/Euro strength. What assets could do well if King$ is peaking out?
One sector that could do really well is mining stocks, due to the chart below, that was shared a week ago.
CLICK ON CHART TO ENLARGE
The chart above was shared a week ago, reflecting the potential that Miners could outperform the S&P 500 for years to come.
As mentioned in the top chart, for the US$ to have a chance to see meaningful selling pressure, support line (2) first needs to be taken out.
Full Disclosure- Premium and Metals Members due to the patterns above, are long Junior Miners (GDXJ), as this ETF was purchased the first day after the Christmas break.
