King Dollar slipping below support, say Joe Friday

joefridayusdollarsmallsupportbreakapr24CLICK ON CHART TO ENLARGE

King Dollar has been on a role since last summer, up over 20% in less than a year. When looking back on the US$, the rally has been rare and nearly historic. Majority of the rally took place inside the steep rising channel above. Over the past month the US$ might have put in a double top. Over the past few days, the US$ has slipped a little below rising support at red arrow above.

On 3/31 I shared the chart below with members. This chart highlights times when the US$ is up over 12% from the prior year and created a 2% or more reversal pattern, on a monthly basis.

usdollarreversalpatternfutureresultsapr24CLICK ON CHART TO ENLARGE

As you can see from the table above, this type of reversal pattern after a strong rally has only happened 4 times in the past 30-years and few times has the US$ made much upward progress after this type of situation.

Joe Friday Just the facts- King Dollar did something rare last month (reversal pattern after a big gain) and is a fraction below steep rising support. Should the US$ train slow down or weaken some, a few commodities could catch a bid and push them higher.




800 Pound breakout attempt for Dow and S&P in play



When it comes to the Dow and S&P 500 this year, have you found yourself yawning of late? I have, as its been a pretty boring year for both of these indices. The chart below reflects that over 100 days have passed and the S&P is up just over 2% and the Dow is up just over 1% (see chart below).

performanceytddowspxapr23CLICK ON CHART TO ENLARGE

Can we point a finger as to why the markets have been doing nothing more than marking time? The chart below looks at the Dow and the S&P 500 over the past 20 years. I applied Fibonacci to the 2007 highs and 2009 lows for each and looked at extension levels.


dowspx800poundfibresistanceapr23CLICK ON CHART TO ENLARGE

As you can see above, both are attempting to break above 800 Pound Fibonacci 161% Extension levels at the same time! How these markets resolve this breakout attempt, could tell us a good deal about where the markets are weeks to months from now.

Did someone say “Sell in May and Go Away?”

These Fibonacci extension levels could have much to say about breakouts by these key markets!



Nasdaq 100 attempting historical breakout!

ndxattemptingtobreakfreeapril22CLICK ON CHART TO ENLARGE

When looking at performance over the past 1, 2 and 5-year time frames, the NDX 100 has out performed the S&P 500 and Small Caps (Russell 2000) in each of these time windows. The chart below looks at the performance over the past 5-years.

The top chart reflects an attempt by this strong index to break above monthly closing highs in 2000, represented by line (1) and a resistance line (2), which is tied to the lows in 1990, 2002 and 2008. These lines both meet at price point (3) above.

performance5yearsndxmdyspyapr22CLICK ON CHART TO ENLARGE

The NDX remains the “leader of the pack” from a performance perspective. A “Break Out” at (3) above would be a positive for the Tech sector and could influence other markets U.S. markets in a positive way.

At this time our Shoe Box Indicator, High Yields, Advance/Declines and Discretionary/Staples ratio are sending OK messages about the market in general. With these messages being sent, it increases the odds the NDX can “Break Free” from these resistance lines.