Scallops are broad patterns as shown in the chart. Whilst de-dollarisation is happening at a slow macroeconomic pace, coming from Russia, China and Japan (largely), it doesn't mean that the US Dollar will simply roll over.
The pattern of the scallops is quite visible. Now the US-Dollar is at a critical point and making attempts to do another scallop. I don't assume that each scallop will be less prominent than the previous. Overall the trend from April 2018 seems to be weakening but I make no assumptions that in the short term (next few weeks) the US-Dollar will not bounce north.
US-Dollar strength is broadly inversely correlated with commodities, metals and US-stock-markets - whilst affecting the strength of other currencies indirectly.
The pattern is useful in terms of assessing other positions in the markets both on Stock Markets and Forex.
I agree with you. Very good analysis. Now I'm not expecting a bigger dollar move. Rather, it is a slow sideways movement. I don't pay attention to this shape, but it's very imaginative.
Captain_Walker
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@meszaros, Thanks. If it is imaginative, it wasn't my imagination. As you may know (but probably not 'everybody'), the pattern of scallops has been known and well described by others many years ago. I''m not at liberty to give a reference in posts and comments - and not at liberty to allude to any reasons either. I'm not saying that it's top secret. ;) :)