What is the most likely scenario for USD in the next 5 years!

What Is the U.S. Dollar Index?
The U.S. dollar index is a measure of the value of the U.S. dollar relative to the value of a basket of currencies of the majority of the U.S.'s most significant trading partners. This index is similar to other trade-weighted indexes, which also use the exchange rates from the same major currencies.
The US Dollar Index is used to measure the value of the dollar against a basket of six world currencies - Euro, Swiss Franc, Japanese Yen, Canadian dollar, British pound, and Swedish Krona.
The index was established shortly after the Bretton Woods Agreement dissolved in 1973 with a base of 100, and values since then are relative to this base.
The value of the index is a fair indication of the dollar’s value in global markets.

Now let's evaluate the U.S. Dollar Index in the past 36 years: (Monthly chart: each candle equal to 1 month)
DXY has had a -30% performance and decreased from 129 to 90 in the past 36 years! It moves in a downtrend channel with a -7 degree angle!
快照

Past Major Bullish rallies: Lasts 11-12 years with 45-50% gain.
快照

Past Major Bearish rallies: Lasts 6-7 years with -39 to -41% decrease in value.
快照

Current situation: It seems we are at the early stages of a new bearish case which could be last in the net 5-6 years and cause a -30% decrease in the US dollar value. ( The most probable case scenario)
快照

Now let's look at US dollar performance in comparison to the basket:

Euro: Got out of the bearish channel in comparison to the US dollar and gained +15% in the past 14 months.
快照

Swiss Franc: gained +9% in the past 14 months in comparison to the US dollar
快照

Japanese Yen: lost 2.5% in the past 14 months in comparison to the US dollar
快照

Canadian Dollar: gained +19% in the past 14 months in comparison to the US dollar
快照

British Pound: gained +16.6% in the past 14 months in comparison to the US dollar
快照

Swedish Krona: gained +22% in the past 14 months in comparison to the US dollar
快照

All these data show one thing:
Effect of Money Supply on the Economy
An increase in the supply of money typically lowers interest rates, which in turn, generates more investment and puts more money in the hands of consumers, thereby stimulating spending. Businesses respond by ordering more raw materials and increasing production. The increased business activity raises the demand for labor.
The opposite can occur if the money supply falls or when its growth rate declines.

Pay attention to the last sentence very seriously..!







Chart PatternsDXYSupport and ResistanceTrend Analysis

免责声明