Dollar Index: failed to break higher, but don't lose faith in the USD yet
|$INDEX
$Index tried to break higher yesterday and although we have not yet broken yesterdays low...the market isn't looking that great....We did see the D/T at 102.....and we have retraced 50% of the move up from 9590 to 10380....We really do need to cling onto this 9985/80 support...because if we do not then sadly the $ will get weaker...and this will affect our currencies which should strengthen.... Gold and Oil as well....I know we have backed away from the $ Gold correlation a bit lately...but it is still there and does come back into focus...as we have seen over the past few sessions...
I have not lost faith in the $ as yet.. but it is testing my patience at the moment...and below 9950 I will reassess our buy $ dips scenario.... Now the Index mainly does affect the Euro as it is the largest of the currencies in it.. and this is exactly what we have been seeing....The Euro looks strong at the moment.. although as we mentioned it has got work to do and 10885 is going to prove to be quite difficult to break....however ...back to our Index....
The level that is required to break to keep us from falling further is 100.25...This is our short term 23.6 Fib...and is also where we stopped yesterday.....so this level is very important....We have to break and hold above here to push us higher....taking of $ weakness pressure and then we can look for the $ to strengthen once more....As the $ has been trending higher these corrections are quite common.... You can see above the daily chart is entering oversold...and so is the 60 min.. However the 4 hrly is still pointing lower and is at quite neutral levels...Weeklies still look a bit toppy currently...so I think as we have a couple of currencies running...we will not add until the position becomes a little clearer...Yesterday was quiet...but I think that the next few days we should get some movement.... It is seriously all about levels at the moment....so 10025 and 9950 are those little levels you should have your eyes glued to...
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