As we all know U.S government has shut down. I hope you are not surprised to see U.S stock market going up very next day of the government showdown!!
More than the shutdown, here I want to talk about Dollar Index ( DXY). Technically as you see in the charts above, DXY Index up trend was broken below 81.50 and now the trend remains down and is going lower. Given that it is very unlikely we are going to see any Fed's QE Taper anytime soon. Even if they taper, I think that would be sometime next year in 2014 February-March. America cannot live without artificial money!! They are so use to it ...
No QE tapering = Weak Dollar = Strong Gold.
We will talk about Gold later. Coming back to Dollar Index. As of now what I could see is an intermediate support/target at 79.55-79.60 as marked in the ellipse. It would be interesting to see how DXY would be trading near that level. Bounce or break down?
A break or close below 79.5 would take the index all the way down to 77.8-78. By then I am sure, Dollar would be rescued. So for now use all rally in DXY Index to Sell.
But hey, what about Indian IT stocks?? IF my analysis over Dollar Index is correct, IT stocks will find it very difficult to remain at the current levels and as the safe haven as many analyst/TV pundits are projecting them to be right now, because if our twin deficits improve, India's growth accelerates, USDINR will go down as well, making Rupee to appreciate further.
Good Luck, Be Safe ....
 |
| Dollar Index (DXY) weekly charts: Trend is down, Sell on Rally |
More than the shutdown, here I want to talk about Dollar Index ( DXY). Technically as you see in the charts above, DXY Index up trend was broken below 81.50 and now the trend remains down and is going lower. Given that it is very unlikely we are going to see any Fed's QE Taper anytime soon. Even if they taper, I think that would be sometime next year in 2014 February-March. America cannot live without artificial money!! They are so use to it ...
No QE tapering = Weak Dollar = Strong Gold.
We will talk about Gold later. Coming back to Dollar Index. As of now what I could see is an intermediate support/target at 79.55-79.60 as marked in the ellipse. It would be interesting to see how DXY would be trading near that level. Bounce or break down?
A break or close below 79.5 would take the index all the way down to 77.8-78. By then I am sure, Dollar would be rescued. So for now use all rally in DXY Index to Sell.
But hey, what about Indian IT stocks?? IF my analysis over Dollar Index is correct, IT stocks will find it very difficult to remain at the current levels and as the safe haven as many analyst/TV pundits are projecting them to be right now, because if our twin deficits improve, India's growth accelerates, USDINR will go down as well, making Rupee to appreciate further.
Good Luck, Be Safe ....
No comments:
Post a Comment