“It's hard to tell if this will form a double top, but it's definitely worth trying to short the Dollar here” (#94).
Up to this morning, shorting the Dollar has been a good idea. But it's still too early to call for a real trend reversal. The 108 mark held for the first time and as I wrote before, the situation for Dollar shorts only looks good below the 107.80/70 support zone.
The Jackson Hole Economic Symposium starts today and lasts until Saturday. But to be honest this event never changed markets desicively as far as I can remember. My expectations are therefore rather low. It's more like the regular US debt ceiling event, which makes news but never seriously threatens the Dollar. Nevertheless, the gentlemen could talk about how their monetary policy is to blame for global inflation, and whether it is now time to reverse the race to lower interest rates and larger balance sheets. Spoiler: That's not going to happen.
(source: fxstreet.com)
The EURUSD currency pair appears to really want to bottom and a daily close above parity would of course help the Euro. Despite this, the Euro remains my least favorite currency for shorting the Dollar. As long as Ms. Lagarde does not abandon her plans for direct market intervention in favor of individual peripheral bonds and maintains her low interest rate policy, the Euro should remain under pressure.
In the short-term picture, parity remains a hurdle. Above that I see the mid Bollinger band (1.0151) and the 50 ema (1.0243) together with the descending red trendline as resistance. The last two daily lows at 0.9910/00 form the short-term support zone.
Good luck,
Sebbo