Market Direction and Stock Trends

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US Dollar Index (Cash)(DX) - Pressing Lower »» Weekly Summary Analysis
By: Marty Armstrong | May 8, 2021

THE CASH US$ INDEX closed today at 902350 and is trading up about 0.33% for the year from last year's settlement of 899350. At present, this market has been declining for 2 months and if the market continues to remain beneath the previous month's low of 904250 on a closing basis, then it will remain weak for now. This price action here in May is warning that we may have at least a temporary high in place beginning perhaps a bearish reactionary move on the monthly level if we see lower prices next month or close lower. Otherwise, there remains the potential for a one-month Knee-Jerk reaction low. As we stand right now, this market has made a new low breaking under the previous month's low dropping to 901900 intraday and remains trading beneath that level.

ECONOMIC CONFIDENCE MODEL CORRELATION

Here in THE CASH US$ INDEX, we do find that this particular market has correlated with our Economic Confidence Model in the past. The Last turning point on the ECM cycle low to line up with this market was 2018 and 2011. The Last turning point on the ECM cycle high to line up with this market was 2020 and 2017 and 2009 and 2005 and 2001 and 1994.

MARKET OVERVIEW
NEAR-TERM OUTLOOK

The historical perspective in the THE CASH US$ INDEX included a rally from 2011 moving into a major high for 2017, the market has been in a bearish trend since the high moving into the low in 2018 for a declining trend during that year. The last Yearly Reversal to be elected was a Bearish at the close of 2020.

This market remains in a positive position on the weekly to yearly levels of our indicating models.

From a perspective using the indicating ranges on the Daily level in the THE CASH US$ INDEX, this market remains in a bearish position at this time with the overhead resistance beginning at 905900.

On the weekly level, the last important high was established the week of March 29th at 934350, which was up 12 weeks from the low made back during the week of January 4th. We have seen the market drop sharply for the past week penetrating the previous week's low and it closed beneath that low which was 904250. This was a very bearish technical indicator warning that we have a shift in the immediate trend. We are trading below the Weekly Momentum Indicators warning that the decline is very significant and we need to pay attention to the timing and reversals.

INTERMEDIATE-TERM OUTLOOK

YEARLY MOMENTUM MODEL INDICATOR

Our Momentum Models are rising at this time with the previous low made 2018 while the last high formed on 2020. However, this market has rallied in price with the last cyclical high formed on 2017 warning that this market remains strong at this time on a correlation perspective as it has moved higher with the Momentum Model.

After the closing below the previous year's low of 950300.

Some caution is necessary since the last high 934350 was important given we did obtain three sell signals from that event established during March. That high was still lower than the previous high established at 1029900 back during March 2020. Critical support still underlies this market at 894001 and a break of that level on a monthly closing basis would warn of a further decline ahead becomes possible. Nevertheless, at this time, the market is still weak trading beneath last month's low.

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