The US dollar index ($DXY): The US dollar index extended its major (long-term) downtrend during June, falling to a low of 96.75 before closing at 96.88, down 2.45 for the month. The low, posted on June 30, was the weakest the Index has been since March 2022. Theoretical Positions: Investors might’ve sold near the January 2025 close of 108.37 based on the completion of a technical bearish spike reversal. (It’s also interesting to think about what else happened in the US during January.) Otherwise, investors might still be on the sidelines.
The Euro (^EURUSD): The euro extended its major uptrend to a high of 1.17884 during June before closing the month at 1.17873, up 3.9% for the month. Last month’s high, also hit on June 30, was the strongest the euro has been since September 2021. Technically, we see a new low of 1.017766 was posted during January before the euro closed at 1.03595, up fractionally for the month. This coincided with a bullish crossover by monthly stochastics below the oversold level of 20%. This means the euro both signaled (stochastics) and confirmed (reversal pattern) a new major uptrend. Theoretical Positions: It’s possible long-term investors established new long positions near the January close of 1.03595 with sell stops below the January low of 1.01776.
The euro/Canadian dollar (^EURCAD) extended its major uptrend during June, hitting a high of 1.60915 before closing the month at 1.60411, up 2.9% for the month. Theoretical Positions: Buy orders would’ve been filled above the previous 4-month high of 1.51711 during March. Sell stops would be moved up to below the previous 4-month low of 1.50041 from March 2025.
The Canadian dollar (^CADUSD) extended its major uptrend to a high of 0.73854 during June before closing at 0.73483, up 1% for the month. The loonie turned long-term bullish at the end of February as it completed a bullish key reversal on its monthly chart. This also coincided with monthly stochastics establishing a bullish crossover below the oversold level of 20% meaning the loonie both signaled (stochastics) and confirmed (reversal pattern) the new major trend. Theoretical Positions: Investors would’ve bought back short Canadian dollar positions near the February settlement of 0.69125 and gone long at the same level. Sell stops would be placed below the March low of 0.68769.
The Brazilian real (^BRLUSD) extended is uptrend to a high of 0.18430 before closing June at 0.18406, up 5.4% for the month. Theoretical Positions: Investors likely bought at the new 4-month high during March and April, putting the position at an average of roughly 0.17815. Additional positions might’ve been bought during June at the new 4-month high of 0.17876 raising the average long to approximately 0.17835. Sell stops would be below the previous 4-month low of 0.16367 (April 2025).
