Monday, October 26, 2009
Dollar Close to Confirming Bottom - USD/CHF Needs Close Above Trendline
To supplement the EUR/USD analysis in the previous post regarding a dollar bottom let's look at the US dollar vs. the swiss franc (USD/CHF). You can see the wave count can be complete here, and the strength from the lows accompanied by bullish divergent momentum indicators, and the non-confirmation of not making a new extreme against the dollar like the euro did, all add up to a possible significant US dollar bottom at hand. Above I show the 4hr USD/CHF chart with a descending trendline that has capped the decline the entire 5th wave of C. A daily close above that level, which is at about 1.0200, would strongly indicate that a US dollar bottom is in.
The dollar picture is very important for the stock market view as a dollar bottom would indicate a stock market top.