In the two charts below, is the long term outlook on the USD presented. The USD has seen a remarkable run over a period of about 9 months. That has pushed several currencies of developing economies lower which only added pressure to international commodity trade that has already been suffering for several years. The Good news is that usually after such a run, whatever the instrument it is, what follows is a last swing before the trend reverses.

Below I present my preferred count. The alternative count is not much different, however it would indicate that the top is already in place at 100.390 on March 13th, 2015. However, judging on the price action after that point, I am tending towards having one more swing higher that will push the Dollar Index beyond 100.390 putting further pressure on developing currencies and possibly commodities.

As discussed in the last post, relation between USD Index and commodities is by no means linear, however considering the overall fundamentals and general sentiment of the market, I would view that any news on strengthening USD will push traders to sell commodities. A relation that probably will be best displayed in Oil prices in the near term future!

Before I present the chart, I can only say, hold your seats and brace for impact, who survives will be seeing better days soon. 🙂

USD Index Weekly Count

USD Index Daily Count