Home » USD index » Dollar Index Candle Chart 8 Oct 2009

Dollar Index Candle Chart 8 Oct 2009

Dollar Index Chart 8 Oct 2009

Dollar Index Chart 8 Oct 2009

The US dollar index continued on its downward path for currency options trading yesterday with another bearish candle which closed as a narrow spread down bar, but with an upper shadow to the body, which simply reinforces the bearish sentiment in the market at present. Angst over the dollar has now moved to the highest levels of government with President Obama himself coming under fire, although the current low is no worse than 2007 levels which signalled the start of the current financial crisis.  From a technical perspective bearish sentiment towards the dollar is further reinforced by the high of the day, which found strong resistance from both the 9 day and 14 day moving averages which are once again adding considerable pressure to the index from above and with no respite in site for the US dollar, for currency options trading today the message remains the same – sell the US dollar until further notice, or until the fundamental news is consistently suggesting that the worst of the recession is over, in which case the FED may then siganl a change in its policy. Until then, the US dollar will continue to slid ever lower, and fulfill its role as the low yielding currency of the carry trade, once the preserve of the Japanese Yen.  Technically the only glimmer of hope for the index remains in the 75 price point, and should this substabtial area of support be breached then the long drop to 72 is likley to be the next pause point in this relentless move lower.