Another 48h - Breakout From 12 Day Downtrend In DXY

2024/12/10
Another 48h - Breakout From 12 Day Downtrend In DXY
“dxy slightly bullish ahead of us inflation data tomorrow!
inflation data tomorrow? day after tomorrow ppi data?”



French President Emmanuel Macron wants to name a new prime minister for France “within 48 hours,” party leaders who met him on Tuesday told Agence France-Presse. The president invited leaders from across the political spectrum, leaving out the far-right Rassemblement National (RN) and the far-left La France Insoumise (LFI), which led the ouster of Prime Minister Michel Barnier last week. What an exciting political time! What happens next politically? With France? Let alone my country of birth, my home country, where I have been at home for more than 46 years? I don't know! But what I know is that none of this is a coincidence - maybe it's some sort of conspiracy! No - this is all the political consequence of the last few years, the last decade, even I go as far back as 2008! When Bear Stearns Bank threatened to go bankrupt. Like Lehman Brothers Bank. However, Bear Stearns was taken over by JP Morgan Chase at the time. While Lehman Brothers was allowed to go bankrupt - and US taxpayers had to pay the costs. By the way, Faster Capital recently wrote a short, crisp reminder as a reminder, in June 2024: A Tale of Two Banking Giants. Since then I have been and remain in the fiscal policy, monetary policy and/or economic policy camp “we need more Lehman Brothers”, like Peter Shiff. Don't subsidize bad money - unprofitable companies with tax money because they can't or don't want to finance themselves. Support financially? Clear! But don't subsidize it with tax money under the guise of liberal democracy. And that's what our politicians in our so-called West have done since then - especially the Greens under the guise of a free liberal democracy. I was one of them, until the outbreak of the euro crisis, from the beginning of 2010 to 2012. Mario Draghi then ended the emerging topic of the dissolution of the euro with a "Whatever it takes" speech in London, as then ECB President. But that is not the topic here. Rather, the political consequences of a political generation that has tacitly allowed itself to be handed over to the green, fantastic Eco Chamber - and in front of whose internal (i.e. psychological & philosophical) and external (monetary & material) ruins we are now standing. Me too! See France? Above all, see Germany? What will be very nice to observe in the political development of the USA. Because most of what happens politically in the USA - but admittedly not everything - has a more or less time-delayed effect here in Europe (as is obviously the case in France and Germany). Because in the USA, at least I claim today, the so-called RINOs (conservatives who are secretly freedom-loving) first implicitly accepted Obama; until Donald Trump came along with his MAGA movement. And when Biden tried again in 2020 to turn the tables on domestic politics in the USA - which he succeeded - the RINOs once again realized, unspoken, that green politics, sooner and/or later, more and/or less, under the Biden & Harris government leads to stagflation, fortunately not (yet) into a recession. And unspoken accepted the no green policies of the MAGA Movement, what we all worldwide experienced live, With their electoral success, the US Republicans recorded one of the greatest, if not the greatest, political comeback in history, at least in our so-called West, since the end of World War II. Admittedly, I also supported Trump - but I couldn't even begin to imagine such success! Which is why I'm so disciplined and euphoric for the year 2025, for the coming years for Trump. But slowly, - first comes Christmas, then the New Year 2025, and on January 20th, 2025 it finally starts! Trump Back in Office!

Trump Back in Office! That's why the MAGA movement came about. Politically to the right alongside a Green policy under the guise of preferential democracy. And what the political problem and/or the solution is for us here in Europe, even in our so-called West, with our diverse political systems, in our numerous individual countries, where we are generally dependent on coalition partners. Because Green politics is state subsidies - socialism for their own voters, NGOs, party members. But they never represented the majority of the population. And/Or never wanted to represent it. Just green socialism, under the guise of liberal democracy. And I would also go so far as to say that this green policy, under the guise of a liberal free democracy, was and is the most important reason, the most decisive cause, for the current political scenario in Syria - and/or even in Ukraine. Which is why I generally don't feel any negative resentment towards green politics! But I would like to point out that you can also vote against green policies. That you can argue against green politics in a very healthy, peaceful, self-confident and free way. Simply just don't vote green! Which is also the political dilemma here in my home country Germany! Because some prefer freedom to prohibitive politics while others prefer to be green, and then sooner or later, due to their prohibitive policy, they will more or less inevitably, and consequently, find themselves in socialism. some even under the guise of religion!? What the Friedrich Naumann Foundation article also describes very well: “The Janus face of Javier Milei: A market economy at home, but still closed to the outside world." Because the Syrians, as Ukrainians, are currently struggling the most with the external political consequences (in monetary and/or material economic terms). While we are doing relatively well in France and Germany, in the euro area (in monetary and/or material economic terms). Still? And that is the fear of decline that politics has to manage! And why we are all witnessing the end of green politics under the guise of liberal democracy, in our so-called west. However, I'm realistically optimistic everyone be historically honest, put their cards on the table, both in private life and, above all, in politics, in the public debate: "Here I am - here we are today: the country, the party, the taxpayers' money & I want to achieve that for the country, with the party, with the money, I want to lead the country, with my party, with your tax money to this goal!" I think that´s it what the most one of us, me too, want to know! Don`t you, too?

• Will the bulls recapture the terrain above 106.517 points again?
  
• Will the bears recapture the terrain under 104.447 points again?
  

Those were the two questions last calendar week - to learn something! And what have we learned? Both bears and bulls were not that strong. Looking back, I may have to admit that, for better or worse, I defined the price action a little too far apart. But I think we should give ourselves time until 2025. Even until January 20th, when Trump is officially back in the office. Because then the cards are shuffled again as far as the price action is concerned. And until then, we should continue to be content with the same question. Because the price action between 107.348 points (Annual Year High 2023 from 2023/10/03) and/or 106.517 points (1st Annual Year High 2024 from 2024/04/16) are groundbreaking. Last week before the bears took over. pathbreaking for last week, and/or this week after DXY closed at 105.970 points this weekend, after last weekend 105.782 points. Which is why it looks like we will see a DXY down to 104.447 points from Friday, the 2024/08/02.

“My main concern is with the world order.”
George Soros

• Will the bulls recapture the terrain above 106.517 points again?
  
• Will the bears recapture the terrain under 104.447 points again?
  

It looks like we will see a DXY down to 104.447 points from Friday, the 2024/08/02 because a price action until this price action zone and/or even below is definitely within the scope of probability. Because looking back, between the annual highs of 2024 and/or 2023, we can now see something like a bearish trend reversal formation in the DXY chart. Admittedly not as big as the bullish trend reversal formation - but at least a bearish counter reaction to the previous bullish one. And this could send the DXY even until around and/or down under 104.447 points from Friday, the 2024/08/02. When fears arose in the financial market that the US unemployment rate would skyrocket, the Fed would have to cut interest rates to prevent an US recession, and as a result, US inflation would inflate again - and we were nevertheless cyclical as history tells us still fall into a US recession. However, will it happen? It will be like it will be! And/Or allow me to use the words of El-Erian: “Fed Will Be Comfortable Cutting Rates”, as you can hear on Bloomberg Surveillance Podcast, from last Friday, as the last US unemployment rate came out.


108.071 : 2024/11/22 - Annual Year High 2024
107.348 : 2023/10/03 - Annual Year High 2023
106.547 : 2024/12/10 - last price action
106.517 : 2024/04/16 - 1st Annual Year High 2024
106.490 : 2024/05/01 - 1st False Breakout To New High
106.130 : 2024/06/26 - 2nd False Breakout To New High
104.799 : 2024/07/30 - High Before W Trend Reversal Formation
104.426 : 2024/08/02 - High Of The August 2024 2 Day Sell-Off
102.160 : 2024/08/03 - Low Of The August 2024 2 Day Sell-Off
Be that as it may, both US inflation data on Wednesday and/or PPI data on Thursday will pave the way for the DXY this week. Which is why I pay a lot of attention to the price action areas mentioned above, because I assume that we will move bullish or bearish in one of the two directions.

So far today, the DXY has risen by +0.36%, until now.
To be honest, I didn't assume that - as you can see in yesterday's blog if you want. But good. The downward trend line drawn has served its purpose. And now, at the current hour, on Tuesday, December 10th, 2024 at 1:00 p.m. New York time, we have to deal with the price action of 106.547 points. And we do that too! To what extent? Tomorrow US inflation data on Wednesday and/or PPI data on Thursday will lead the way of the price action. Or let me explain much more in a detailed overview; the reaction of the market will lead the way of the price action. Anyway, I don't want to speculate in advance; what will happen! But perhaps the numbers could be higher than expected? Or am I reading far too much into today's price action? Am I reading too much into the breakout of the downward trend, which has now been going on for 12 trading days - in which there were recently 3 green bullish trading days (after 8 red bearish ones & one green bullish one)? I don't know! We will experience it tomorrow and the day after! Especially on Friday, when we have slept at least once on both US inflation data on Wednesday and/or PPI data on Thursday. And looking back, we may (not) form a new opinion. Be that as it may, we are now back in territory between the annual high of 2023 with 106.517 points and/or the previous annual high of 2024 with 107.348 points! Nevertheless, a relapse wouldn't surprise me. But as I said, we are currently bullish in the DXY on the 3rd trading day - so we have to recapture the daily highs from Monday, December 2nd (with 106.731 points), 2024 & Tuesday, December 3rd, 2024 (with 106.602 points) and/or also December 4th, 2024 (with 106.720 points). In order to first defend the underline of 106.517 points - the annual high of 2023. But the whole technical competence what i tried to formulate is of no use, let me stay honest, because the US inflation data tomorrow and/or the PPI data on Thursday will determine the price action during the next 48h. And then the price action, the reaction of the market, of all (not) involved financial market participants, the news.


With best wishes
and with good intentions!
Aaron



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