Price-adjusted Major Currencies Dollar Index -- Monthly Index (FED Data)

USD Index Uptrends % Change

170%

160%

150%

140%

130%

120%

110%

100%

90%

Index (Oct 1978 - )

Index (Apr 1995 - )

Index (Jul 2011 - )

We can see from the above chart that the USD Index has further room to appreciate, judging from historical price patterns
The previous two multi-year USD upward trends lasted for :
- 76 months for the uptrend started in Oct 1978, for a total appreciation of around 60%
- 81 months for the uptrend started in Apr 1995, for a total appreciation of around 49%
We are currently (June 2015) in month number 46 of the uptrend started in Jul 2011 and we reached a maximum appreciation of 33% in month number 43 (March 2015).
Also, as can be seen from the chart, we are currently in an area where corrections usually occur (time wise). Thus:
- for the uptrend started in Oct 1978, a correction of 8% occurred between months 47 and 50
- for the uptrend started in Apr 1995, a correction of 10% occurred between months 39 and 44
Consequently, time wise, we should have at least another 30 months of USD uptrend ahead and another 15% (at least) appreciation.
Based on this and on the fact that USDJPY has already played a large role in the USD's appreciation (percentage wise), then European and commodity currencies should bear the major
brunt of further USD appreciation. This should take :
- EURUSD towards 0.90 (currently 1.1350, with potential to go to 1.18 before lower)
- GBPUSD towards 1.35 (currently 1.5850, with potential to go to 1.63 before lower)
- USDCHF towards 1.15 (currently 0.92, with potential to go to 0.89 before higher)
- AUDUSD towards 0.60 (currently 0.7750, with potential to go to 0.80 before lower)
Enjoy the USD uptrend for another 30-40 months and prepare selling it afterwards!