Wednesday, August 22, 2012
Dollar Index Euro and Markets running opposite directions
Dollar Index Euro and us markets running in opposite directions as Fed Feather reports and traders come back from holidays.
The Dollar index Euro and US markets are in a complete disconnect from normal trading patters. As the S&P500 emini futures has breached the 1400 psychological ceiling and has been holding it as support we see that the US Dollar index on the futures markets. For the past three days traders have been selling the dollar which normally pushes up the Euro. The chart reflects the price action but there is a disconnect with the price action on the S&P500 emini futures. We will go more into the price action on the S&P500 emini futures on the next chart. Monday the S&P500 rallied to new highs and breaching the resistance at 1418.this is when the dollar index pushed down through the floor at 82.500 and dropped almost a full penny in the next session. The Euro is also showing a rally fro 1.23.67 where it rallied through its resistance on the 50MA and proceeded to move up to 1.2535 the following two sessions. If the S&P500 emini futures were to have followed the same trajectory, traders would have expected to see this move to 1433-39. The Euro has powered on and kept the direction moving to the 200MA where we could see some support coming in. The dollar index and the euro move hand in hand and can be seen moving this way. Temporarily they will disconnect and we will see one consolidate and the other beg [...] day trading course
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