{"id":193419,"date":"2023-07-13T13:41:57","date_gmt":"2023-07-13T17:41:57","guid":{"rendered":"https:\/\/ibkrcampus.com\/?p=193419"},"modified":"2024-01-24T12:13:10","modified_gmt":"2024-01-24T17:13:10","slug":"chart-advisor-dollar-drops-to-52-week-low","status":"publish","type":"post","link":"https:\/\/www.interactivebrokers.com\/campus\/traders-insight\/securities\/macro\/chart-advisor-dollar-drops-to-52-week-low\/","title":{"rendered":"Chart Advisor: Dollar Drops to 52-Week Low"},"content":{"rendered":"\n<p><strong><a href=\"https:\/\/www.investopedia.com\/contributors\/54841\/?utm_source=chart-advisor&amp;utm_campaign=fwd_chartadvisor&amp;utm_term=27774019&amp;utm_medium=email\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>By&nbsp;<\/strong><\/a><strong><a href=\"https:\/\/www.investopedia.com\/contributors\/54841\/?utm_source=chart-advisor&amp;utm_campaign=fwd_chartadvisor&amp;utm_term=27774019&amp;utm_medium=email\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>J.C. Parets<\/strong><\/a>&nbsp;&amp;&nbsp;<a href=\"https:\/\/get.allstarcharts.com\/?utm_source=chart-advisor&amp;utm_campaign=fwd_chartadvisor&amp;utm_term=27774019&amp;utm_medium=email\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>All Star Charts<\/strong><\/a><\/strong><\/strong><\/p>\n\n\n\n<p><strong>1\/ US Dollar Index Posts 52-Week Low<\/strong><\/p>\n\n\n\n<p><strong>2\/ Is Energy Next in the Rotation?<\/strong><\/p>\n\n\n\n<p><strong>3\/ Vietnam Hits New Highs<\/strong><\/p>\n\n\n\n<p><strong>4\/ It\u2019s Time to Can the Corn<\/strong><\/p>\n\n\n\n<p><em>Investopedia is partnering with All Star Charts on this newsletter, which both sells its research to investors, and may trade or hold positions in securities mentioned herein. The contents of this newsletter are for informational and educational purposes only, however, and do not constitute investing advice.<\/em><\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-1-us-dollar-index-posts-52-week-low\">1\/ <strong>US Dollar Index Posts 52-Week Low<\/strong><\/h2>\n\n\n\n<p>The&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/u\/usdx.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9664268-20230712&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071223\" target=\"_blank\" rel=\"noreferrer noopener\">U.S. Dollar Index<\/a>&nbsp;(<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=dxy&amp;hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9664268-20230712&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071223\" target=\"_blank\" rel=\"noreferrer noopener\">DXY<\/a>) has taken a less direct route, meandering sideways for the past seven months. That changed during today\u2019s session as the dollar slid to fresh 52-week lows.<\/p>\n\n\n\n<p>And thanks to sellers taking control of the market, today\u2019s session is offering another critical piece of confirming evidence\u2014an&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/o\/oversold.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9664268-20230712&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071223\" target=\"_blank\" rel=\"noreferrer noopener\">oversold<\/a>&nbsp;reading on the 14-day&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/r\/rsi.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9664268-20230712&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071223\" target=\"_blank\" rel=\"noreferrer noopener\">relative strength index (RSI)<\/a>.<\/p>\n\n\n\n<p>Notice that DXY never registered an RSI print below 30, even during the strong selloff last fall.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" data-src=\"\/campus\/wp-content\/uploads\/sites\/2\/2023\/07\/1-7-1100x561.png\" alt=\"\" class=\"wp-image-193421 lazyload\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/561;\" \/><\/figure>\n\n\n\n<p>Today\u2019s oversold reading marks a significant shift in momentum, favoring dollar bears and continued USD weakness.<\/p>\n\n\n\n<p>More importantly for the broader market, a weaker dollar could act as a catalyst for the next leg higher in&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/r\/risk-asset.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9664268-20230712&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071223\" target=\"_blank\" rel=\"noreferrer noopener\">risk assets<\/a>.<\/p>\n\n\n\n<p>Stocks worldwide have enjoyed a consistent bid over the past six months while the dollar has gone nowhere. Imagine how stocks might react if the dollar continues falling.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-2-is-energy-next-in-the-rotation\">2\/ <strong>Is Energy Next in the Rotation?<\/strong><\/h2>\n\n\n\n<p>A healthy&nbsp;<a href=\"https:\/\/www.investopedia.com\/articles\/trading\/05\/020305.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9664268-20230712&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071223\" target=\"_blank\" rel=\"noreferrer noopener\">sector rotation<\/a>&nbsp;continues to pump fresh life into the bull market.<\/p>\n\n\n\n<p>The chart below shows energy (<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=xle&amp;hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9664268-20230712&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071223\" target=\"_blank\" rel=\"noreferrer noopener\">XLE<\/a>) relative to tech (<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=xlk&amp;hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9664268-20230712&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071223\" target=\"_blank\" rel=\"noreferrer noopener\">XLK<\/a>) and industrials (<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=xli&amp;hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9664268-20230712&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071223\" target=\"_blank\" rel=\"noreferrer noopener\">XLI<\/a>) relative to tech challenging a critical level of former lows.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" data-src=\"\/campus\/wp-content\/uploads\/sites\/2\/2023\/07\/2-8-1100x603.png\" alt=\"\" class=\"wp-image-193422 lazyload\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/603;\" \/><\/figure>\n\n\n\n<p>If XLE and XLI are going to embark on a new period of outperformance, this would be a very logical place for it to start.<\/p>\n\n\n\n<p>Industrials are already experiencing a relative bid. It shows in the absolute trend, as XLI recently posted a new&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/r\/record_high.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9664268-20230712&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071223\" target=\"_blank\" rel=\"noreferrer noopener\">all-time high<\/a>.<\/p>\n\n\n\n<p>If this bull market has legs, we could see energy also begin to outperform tech during the second half of the year.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-3-vietnam-hits-new-highs\">3\/ <strong>Vietnam Hits New Highs<\/strong><\/h2>\n\n\n\n<p>Whether one trades international equities or not, it\u2019s downright irresponsible to ignore the strength overseas.<\/p>\n\n\n\n<p>In fact, when we look at international indexes, stocks in many different countries are resolving to the upside.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" data-src=\"\/campus\/wp-content\/uploads\/sites\/2\/2023\/07\/3-9-1100x541.png\" alt=\"\" class=\"wp-image-193423 lazyload\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/541;\" \/><\/figure>\n\n\n\n<p>Vietnam is considered a&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/f\/frontier-market.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9664268-20230712&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071223\" target=\"_blank\" rel=\"noreferrer noopener\">frontier market<\/a>, suggesting amplified risks that extend&nbsp; beyond the risk-fueled emerging markets.<\/p>\n\n\n\n<p>Regardless, investors are bidding up these highly risky stocks.<\/p>\n\n\n\n<p>As you can see, the index is printing fresh nine-month highs as it completes a bearish-to-bullish&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/r\/reversal.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9664268-20230712&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071223\" target=\"_blank\" rel=\"noreferrer noopener\">reversal pattern<\/a>.&nbsp;<\/p>\n\n\n\n<p>Witnessing Vietnam embark on a new uptrend speaks to risk-seeking behavior, making it difficult to maintain a bearish outlook for global equities.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-4-it-s-time-to-can-the-corn\">4\/ <strong>It\u2019s Time to Can the Corn<\/strong><\/h2>\n\n\n\n<p>Corn futures are falling fast.<\/p>\n\n\n\n<p>It\u2019s an excellent example of the extreme directional moves common among commodity contracts, especially&nbsp;<a href=\"https:\/\/www.investopedia.com\/articles\/optioninvestor\/07\/grain_market.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9664268-20230712&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071223\" target=\"_blank\" rel=\"noreferrer noopener\">grain markets<\/a>&nbsp;this time of year.<\/p>\n\n\n\n<p>In the process, corn has completed a multi-year topping formation.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" data-src=\"\/campus\/wp-content\/uploads\/sites\/2\/2023\/07\/4-10-1100x561.png\" alt=\"\" class=\"wp-image-193425 lazyload\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/561;\" \/><\/figure>\n\n\n\n<p>Corn futures are undercutting key&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/p\/pivotpoint.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9664268-20230712&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071223\" target=\"_blank\" rel=\"noreferrer noopener\">pivot lows<\/a>, reaching levels not seen since January 2021.<\/p>\n\n\n\n<p>Based on today\u2019s breakdown amid a prolonged bearish momentum regime, corn futures could revisit their former 2018 highs.<\/p>\n\n\n\n<p>Perhaps these potential lower prices will translate to cheaper grocery bills as today\u2019s&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/c\/consumerpriceindex.asp?hid=aa5e4598e1d4db2992003957762d3fdd7abefec8&amp;did=9664268-20230712&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=071223\" target=\"_blank\" rel=\"noreferrer noopener\">Consumer Price Index (CPI)<\/a>&nbsp;print points to easing inflationary pressures.<\/p>\n\n\n\n<p>&#8212;<\/p>\n\n\n\n<p>Originally posted 12th July 2023&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The\u00a0U.S. Dollar Index\u00a0(DXY) has taken a less direct route, meandering sideways for the past seven months. That changed during today\u2019s session as the dollar slid to fresh 52-week lows.<\/p>\n","protected":false},"author":186,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[4,21,14,16,17,18,6,8,9,22,23,26,3],"tags":[1779,445,2223,2546,1302,15572],"contributors-categories":[13686],"class_list":{"0":"post-193419","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-asia","7":"category-commodities","8":"category-etfs","9":"category-forex","10":"category-futures","11":"category-macro","12":"category-north-america","13":"category-region","14":"category-securities","15":"category-stocks","16":"category-technical-analysis","17":"category-text-articles","18":"category-traders-insight","19":"tag-dxy","20":"tag-rsi","21":"tag-xle","22":"tag-xli","23":"tag-xlk","24":"tag-zc_f","25":"contributors-categories-investopedia"},"pp_statuses_selecting_workflow":false,"pp_workflow_action":"current","pp_status_selection":"publish","acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.9 (Yoast SEO v27.5) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Chart Advisor: Dollar Drops to 52-Week Low<\/title>\n<meta name=\"description\" content=\"The\u00a0U.S. Dollar Index\u00a0(DXY) has taken a less direct route, meandering sideways for the past seven months. 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