The DXY recovery has still produced a Death Cross over the last couple sessions.

The DXY rally stopped shy of the 38% retracement at the 97.61 level and also note that the 200dma resides just above with the NFP report tomorrow. Most traders are looking for another strong employment reading. However, something that should be noted is a “death cross” has occurred in the DXY the last few sessions. A death cross is when the 50dma crosses below the 200dma. The last two samples we have had since 2015 have yielded some downside, more importantly the last one in 2017 produced an almost 10% drop in the index from the time it crossed to the lows in 2018. If tomorrow’s employment numbers come in sour, keep this in mind in the days and weeks ahead.

Steve Voulgaridis