Last week, we pointed out that the Dollar Index (DXY) is starting to put in another attempt at a top, which would be a major catalyst for equities finding a meaningful low. This, coupled with the stock market hitting the most oversold conditions we’ve seen in 2022, had us expecting a stock market bounce. This week, we’ll analyze the stock market bounce as well as rates and the U.S. Dollar to better determine whether this bounce will be a multi-week rally, or a multi-month one.
In this analysis, we look deeper into the U.S. Dollar and the trouble it is causing around the world. As the U.S. Dollar continues to strengthen it can only do so as other currencies weaken. The weaker a currency gets, the more of that currency we have chasing the same goods. This is the definition of inflation, and also why a strong U.S. Dollar is not good for global stability. As a result, we are now starting to see cracks in the system.
We detail this for you more below and also feel free to check out more weekly webinars on YouTube where we discuss broad market levels.
10/06 Broad Market Levels Timestamps
00:00 - Are We in a Stock Makret Bounce or Should We Prepare for One More Low?
03:23 - The WXYZ Pattern
04:26 - Bottoming Into an Inflection Point
06:02 - Why The Stock Market Has Bottomed
08:10 - The Breakout Move
08:20 - The Alternative Scenario
10:51 - The U.S. Dollar and Why It Eventually Has to Go Down
14:07 - The DXY Dollar Index
15:25 - Get Weekly Stock Market Updates
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On the I/O Fund premium site, we provide weekly webinars that discuss what the I/O Fund is buying and selling. We also have a proprietary hedging signal that we monitor in real-time. Following the analysis, we provided for free on YouTube last month “This is Still a Warning Sign” and also in this article “Why the Next Two Weeks Could Determine 2022” we hedged going into the CPI number for a nice gain in a tough market and have had a hedge in place most of September
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About I/O Fund Portfolio Manager Knox Ridley
Knox Ridley began consulting on portfolios in 2007 and is an experienced growth investor in both bull and bear markets, which is hard to find these days. As the portfolio manager of the I/O Fund, he beat the top-performing funds on Wall Street in both 2020 and in 2021. His real-time trade notifications to premium subscribers have garnered 27 entries with over 100% gains in the last two years. Knox began his career as an ETF wholesaler in 2007 before becoming a portfolio consultant for large RIAs, FAs, and Institutional accounts. He is very keen on macro trends and is trained in Fibonacci Trading, Elliott Wave theory, as well as Gann Cycles. He also uses classical technical analysis to manage risk and identify great risk/reward setups. Knox is known for increasing and decreasing allocations for record-breaking returns.
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