Stop Out Tuesday

King Dollar is back in the game after painting a weekly hammer candle right on top of its 100-week SMA. I call that a solid retest but more shake out attempts may in the cards until things pick up steam again. Of course this Dollar reversal has affected almost every of my open campaigns, eventually resulting in stop outs of my entire book. Let’s review…

I’m showing you the long term chart first as it’s the most compelling. Thus far at least this first stab higher after the break out off the 100-week SMA followed by a reversal lower is pretty textbook. What we want to see afterward of course is much more crucial, namely a solid retest which establishes the basecamp for the next advance higher.

Should that fail and the Dollar falls back through about 93.575 (the weekly NLSL), then the dynamics shift considerably and we would look at a much deeper reversal lower. Until that happens of course I’m thinking bullish.

Which is why I’m prepared to take out a long position on a dip to about 94.85 with a stop < 94.315, which is where I expect the lower 100-hour BB to cross over and push higher in a day or so.

Dollar Victims Roll Call

The stop runners did a pretty good job of sniffing out my trailing stop on the E-Mini after which it was taken to the woodshed. I’m walking away with 1.9R again with no complaints whatsoever. This may continue higher here actually, and I admit it’ll be a tough watch the bus speed off without me. But that’s part of the game, folks.

By the way realized volatility (RV) on the E-Mini has been dropping and is expected to bottom out and then punch higher again. Apologies for the mislabel on the chart, so again – RV has been dropping and after bottoming out is expected to punch higher later this week.

This means that we may get an opportunity for a re-entry, if you’re into that sort of thing 😉

Silver is a goner as expected – out at ISL. Precious metals continue to live in a world of hurt, especially with the USD/JPY attempting to advance again. Although not very strongly (see below) so this is a strong sign of weakness and the bears have it.

EUR/USD reversed short of its still falling 100-day SMA and this was actually quite an important hurdle as bullish territory looms ahead. Let’s see if it can paint a new floor above 1.155 and breach that SMA, which would be massively bullish. I wouldn’t like that of course which is why I would be sure to hedge myself accordingly. Definitely a chart I will keep revisiting in the near future.

I’m also out of the USD/JPY campaign. Way too much whipsaw going on here and this is one of the major drivers of DX strength, so the bulls will have to do much better. Anyway, I got away with another 1.3R which is better than a kick in the shin.

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