Dollar Index (USDX) Analysis
Analysis courtesy of the Forex-FX-4X Forex Trading blog.
- The USDX dollar index is currently testing the 79.69 area which was previous resistance which has become support. This level held price on the five previous attempts to move lower.
- The above level is currently aligned with the down sloping range trend line we added last week.
- The heavily weighted EUR/USD currency pair has broken out of an NR4 inside day to the upside with strong momentum. This adds an element of bearish weight to the near term USDX outlook, despite the counter trend nature of the move.
- We will be looking for a sustained break below the current level or a failure with price action confirmation to set directional bias for the following trading sessions.
- Liquidity should be slowly returning to the market as the week progresses and market participants return following the holiday period.
USDX Daily Chart 2012-03-01
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