The dollar’s latest rally is bullishly impulsive on the daily chart — sufficiently so, perhaps, to re-energize the bull cycle begun in February from around 79. The thrust from last Wednesday’s low is also quite enticing from a camouflage perspective, since it failed to take out early April’s “marquee” high at 83.49 after getting past the required ‘internal’ and ‘external’ peaks. Although we don’t trade this vehicle, we monitor it to buttress trades in other currencies. Under the circumstances, a buy signal at x would provide reason to short other currencies, and to brace for possible weakness in bullion. _______ UPDATE (May 15, 3:19 a.m. EDT): The rally tripped an entry signal at 83.38 off a pattern similar to the one shown. The target is 84.26, subject to midpoint resistance at 83.79. _______ UPDATE (May 17, 4:32 a.m. EDT): The most recent thrust brought this vehicle to within 11 cents of the 84.26 target noted above. This has given way to a consolidation and new bullish pattern that projects to 84.56 over the near term, provided the 84.01 midpoint can be surmounted. (See inset, a fresh chart.)________ UPDATE (May 29): A new rally target at 84.95 has emerged that’s based on the pattern shown (a fresh chart, inset). _______ UPDATE (June 5): If bulls are to get traction, we should see this correction turn from very near the 82.03 Hidden Pivot midpoint shown in this new chart.
