Home » USD index » Dollar Index Chart Analysis 19 Oct 2009

Dollar Index Chart Analysis 19 Oct 2009

Dollar Index Chart Friday 16 Oct 2009

Dollar Index Chart Friday 16 Oct 2009

The dollar index chart continued its progress lower last week, only finding some temporary respite on Friday as the index closed marginally higher, and ended the currency options trading session with a narrow spread up candle, but one with a deep wick to the upper body. Clearly the technical signals are not good for the US dollar or the index, with the high of Friday finding resistance from the 9 day moving average, a worrying signal that further weakness is likely as we enter yet another week of downwards pressure on the dollar. Indeed with all three moving averages adding pressure to an already weak technical picture, and with strong resistance in place above at several different price levels, it is hard to see where any recovery will find a base, with the next support level at 72 seeming to be the most likely area in the short term. The fundamental picture remains much the same, and until we see the FED signal an interest rate rise ( which seems unlikely in the short term) then this bearish sentiment evidenced in the dollar index chart will remain firmly in place, and hence for currency options trading, the short side is the only way to trade the US dollar in the forex markets at present.

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