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USD Index 13 May 2010

USD Index 13 May 2010

The bullish momentum for the dollar index appears to have stalled in the past few days, as we hover marginally below the psychological 85.50 price handle on the daily chart and for momentum to be renewed we need to see a break and hold above this price point in due course.  Technically the signals are encouraging with both the 9 and 14 day moving averages providing excellent platforms for the move higher, particularly during the major pullback of Monday which saw the low of the day supported by the 14 day moving average.  With all four moving averages now pointing sharply higher and with the deep price congestion acting as a cushion below in the 80 to 82 price area the upwards direction for the index and for the dollar should continue in the short term. Longer term we are now running into sustained areas of resistance which could prevent the index rising steadily as a result and could even send it lower temporarily if the index fails to breach the 88 price point.

Dollar Index Monthly Chart 13 May 2010

Monthly chart for the Dollar Index.

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