From 10/6 with $USD at 96.69: "$USD has quietly consolidated for quite a while. If you paid attention to $USD strength then gold or GDX shorts were the easy call, especially when they opened below Q4Ps and were below OctPs as well. Anyway, my main point here is that just because $USD has been sideways since 3/2015 doesn't mean the rally is over. It is entirely possible that DXY breaks out above in months to come and this could, along with rising interest rates, be the next big move in markets. This would probably put a lid on USA indexes, even if rising interest rates support financials."
As $USD is important for all markets let's again do a very thorough chart workup.
Sum
All systems go for $DXY on every chart below - quarterly, monthly, weekly on other technicals, then weekly on long term pivots, daily on all pivots, and a last daily pivots & technicals chart. While I think it has potential to go substantially higher long term - let's say breakout above 100 - near term expect to see 99.18-88. Continued $USD strength will cap upside in USA stocks, especially INDU, and could pressure the popular emerging markets trade as well.
Per Jeffrey Gundlach, currency trends tend to persist, so a very strong move up after an 18 month consolidation is not something to be ignored. OK, we can see that 99.88 target and still be within the range, but let's observe pivots and other technicals as weeks unfold to gauge the chances of breaking out up.
Consequences of strong USD for other trades: GLD short, DIA hedge, IWM better long, recent oil strength more likely to fade, and currently strong EEM stocks could get whacked. Conversely if USD suddenly stops or pauses then likely to see GLD bounce, DIA bounce, oil and EEM stocks continue up.
DXY Q
The best move up in Q4 so far across asset classes. There is really nothing to stop this from moving well over 100, though Fibonacci fans will watch 61% from 2001 top at 101.50.
DXY M
Upper BB right now just above 100 and it looks like we should see that - at minimum.
DXY W
Launch above all MAs with movst of them rising slope and power move outside weekly BB. RSI not yet overbought. Very strong here.
DXY W - long term pivots
What I saw early in October was 3rd time above YP and thought that was going to stick given what had happened with medium term pivots and other technicals as well. Right call. It could reach 2HR1 near 100 and technically still be in the trading range.
DXY D - long and medium term pivots
Blast through Q3R1, also blast through OctR2. Next resistance Q3R2 99.18.
DXY D - pivots & other technicals
Should go higher. Daily RSI 2nd time near 75 sign of strength. MAs and BBs sharply rising and currency trends tend to persist even more than stocks.