These days there’s no question that the dollar has been losing its value. For the last seven months the dollar has been on a down-trend with no signs of letting up.
The chart above has the most recent trend channel that has been tight and certain. The most interesting thing about this new trend is that the volume has been steadily increasing and is currently near all-time high levels.
Here is another, zoomed in view of the chart:
The focus on this chart is the move on Monday in which the volume more than doubled average volume and pushed above the 20MA. This is a good sign because with the major moving averages (20, 50, and 200) acting as points of resistance when on top of the stock, the smart money normally either gaps above or throws major weight at the stock which can be seen by a jump in volume.
Unfortunately for this ETF, we see numerous points at which the price has briefly popped above the 20MA only to fail to hold the ground and fall back below.
The difference with this latest pop is that the volume is more than double of any of the others. This volume does appear to be healthy and that is what makes this chart stick out to me.
As with any major move in a stock, the key is to see the following day’s action. Keep an eye on this guy and let’s see if we are in for a legitimate turn around.
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