USD Index 26 Aug 2009
The USD index continues to look very fragile and yesterday ended the forex trading session today with a small doji cross, indicative of a market that is currently lacking any direction. Unfortunatley the future direction, when it comes, is likely to be downside with all three moving averages adding pressure to the beleagured US dollar. As I have mentioned many times before, only a major change in risk sentiment is likely to provide the boost that the US dollar and the dollar index need in order to break higher from the current downward slide. The key support level is now that at 77.50, and should this be breached in the short term then we may well see a much deeper move for the index which may test the 72 price handle once again. For any sustained break higher we need to see a breach of the strong consolidation now created immediatley above the current price level, and only a hold in the 82.0 region or above would signal the current potential downward slide has been reversed.
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