U.S. Dollar Index Rallying into Resistance

The U.S. Dollar Index (DXY) is telling giving us various signal information as we get midway through today's volatile session.

Below we are looking at a daily chart to see where we may be headed.

DXY

As we see risk markets come off today. We are seeing the DXY moving back into the downtrend wedge from July. However, it has hit the top of the wedge and now it is looking to drop a bit. There could be some credence to false breakdown last week, but we do not agree with this case. Our position is that the DXY will chop around until after the U.S. Election.

We expect there to continue to be a bid on the Dollar as a flight to safety takes place. However, our base case is to fade this move and be ready for lower Dollar as the uncertainties (U.S. Election, Stimulus, COVID Vaccine, and Brexit) come to a resolution in the coming weeks.

It is difficult to time these moves, but we are being a presented with an amazing opportunity. Keep cash ready and available to begin selling the Dollar.