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Dollar forms bullish 'golden cross' — here's how to trade it

Thomas Mukoya | Reuters

The U.S. dollar index formed a bullish "golden cross" pattern, which could mean more gains ahead for the greenback, according to technical analysis. And history suggests a rising dollar could have a big effect on the stock market into year-end, determining the winners and losers.

A so-called golden cross is formed when a security's 50-day moving average crosses above its 200-day moving average, potentially signaling the beginning of a longer-term uptrend. This occurred on Friday for the Dollar index, which measures the currency vs. a broad basket of its peers.