US Dollar index capitualtion. A technical view.

The graph of the us dollar index. There is a dangerous pattern of head and shoulder developing. If the usd index breaks below the neckline then it is going to go for a toss. That means a final capitulation of the us dollar against all major currencies.
One of the major hallmark of a head and shoulder pattern is that the right shoulder is slightly higher than the left shoulder. In this case it means that in the short term there might be appreciation of the US dollar against the world basket of currencies and that is probably what we are now seeing. In the long term this rise would provide a greater downward momentum to break through the neckline.

Another thing about the head and shoulder pattern is that once is breaks the neckline then the precipitous drop is equal to the distance from neckline to the top of the head. That means the index can go down to 68 if it breaks the neckline.

When it will happen I do not know because there might be several bumps ahead but if it happens then be on the watchout. Then the only way to protect yourself is to short the us dollar. You will make a fortune of a lifetime.

More than that I do not want to repeat the rest of the story of the US DEBT and how much it is increasing every day. It only adds fuel to fire and drives down the us dollar, in the long term.

All the best. And watch out for the trend ....