US Dollar Index - Daily Candle Chart 4th August 2009
Yesterday’s pivotal candle broke below the 78.50 support level, and one which I have mentioned many times before in the dollar index market commentaries, and with this level now broken we could see a much deeper fall towards the next level now waiting in the 75 to 76.50 region. Should this be breached then we could well see the Index collapse even as low as the 71 area last seen in July 2008. Today the market appears to be taking a breather as traders bank profits and absorb the strong moves across all the dollar related pairs on Friday and Monday. With all three moving averages now weighing heavily on the index there only seems to be one direction for the US Dollar at present and that is South.
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