I'm still wrapped around the theme from the last post. Here is the daily chart of the EUR/USD:
and here's the current ES contract:
I have marked with an arrow the level the /ES was at the last time the EUR was at this level. In other words, we are 120 points higher than we "should" be if the negative dollar/equity correlation worked in both directions!
The big question for me is………..are we approaching a big bounce on the EUR/USD? Take a look at that trendline I've drawn; does the circle represent a bounce point? If so, I'm seriously wondering if our "one-edged sword" is going to send the /ES exploding to new yearly highs. Because a strong dollar seems to be a match on wet tinder, whereas a weak dollar seems to be gasoline on an open flame.
