Home » Currency Option Trading » US Dollar Index – Daily Chart 29th April 2009

US Dollar Index – Daily Chart 29th April 2009

US Dollar Index - Daily Candle Chart 29th April 2009

US Dollar Index - Daily Candle Chart 29th April 2009

Yesterday’s wide spread down bar promptly reversed that of Monday highlighting that the move higher was largely based on hype and very little concrete fundamental news and it therefore came as no surprise to see the Dollar Index head lower yesterday, falling back once again to close below all three moving averages, and simultaneously piercing the support at 85.60 which once again has become resistance to any move higher.  The sideways trend outlined in Monday’s post seems to back in force today and unless and until we see a break above 86.75 or below 83 then the index seems to trade in a relatively narrow range for some time.  The principle factors that are likely to shape the future for the US lie primarily in any encouraging signs in the fundamental data released on a daily and weekly basis, coupled with any flight to a safe haven in the current unusual circumstances of a possible global swine flu pandemic which could have serious implications for any sustained economy recovery, which could be halted even before it starts.  This evening sees the release of the FOMC statement and Fed Fund rate which is expected to remain on hold, although the GDP released earlier today have come in far worse than expected and as such could influence the Board’s decision for this evening.  Most analysts are suggesting that interest rates will be held although some are suggesting a cut to 0.125% which could trigger a period of dollar weakness.

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