Wednesday, September 1, 2010

Bye-Bye US Dollar - Hello Stock Market + TNA

This 4 hour chart of the US Dollar is playing out just as I thought it would.  Price has formed a bearish head & shoulders pattern with the right shoulder now descending to attempt a break of the neck line..  Meanwhile, the momentum indicator is simultaneously rolling over into the BEAR country of negative territory below the ZERO crossover.
As best I can tell, the recent 3 week counter trend rally in the US Dollar is over.  And by implication, the bottom in the stock market (at $SPX 1040) is in.  As such, the cyclical bull of the stock market is kept alive now with a continuation of the higher high and higher low requirement.  Sentiment is absolutely scared witless and that is perfect.  TNA, time to rock and roll!
Click on the chart to ENLARGE

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