US Dollar Extends Rebound, What to Buy It Against

12/12/2014 9:00 am EST

Focus: CURRENCIES

Adam Button

Co-Owner and Managing Director, ForexLive.com

Adam Button of ForexLive.com thinks the question that traders interested in buying the US dollar have to be asking themselves is…where? Adam suggests a few scenarios that should be considered, though he doesn’t think the USD bull market is over.

If you want to buy the US dollar—and I don’t think the USD bull market is over—the question is, where?

One school of thought is to buy the dollar where USD is weakest (JPY, NZD) and expect a complete retracement in everything. The other, I think correct, idea is that any currency that can barely make a gain against the US dollar on Tuesday (AUD, GBP) is very weak.

chart
Click to Enlarge

Performance Tuesday versus USD

The other option would be to buy a basket of currencies versus USD.

By Adam Button, Editor, ForexLive.com

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