Tuesday, July 29, 2014

US Dollar Index (DXY) posts new 6 month highs towards the 81.482/81.388 range resistance area; strong momentum suggests further upside; Buy on pullbacks


US Dollar Index (DXY) channeled up strongly for the last three weeks to threaten the 81.482/81.388 8-month resistance zone. With the daily and weekly indicators still bullish, scope remains for further upside. Reclaiming 81.482 would complete an 11-month flat base over the 78.998/78.906 lows and trigger further gains towards 82.671 (Sept 5, 2013 lower high) initially. 80.801 near the 3-week channel support should hold dips. Only below there would dampen the bullish momentum and expose 80.420 and the 200 day moving average currently at 80.292.

Trading Bias
Near term, buy on pullbacks
Buy zone around 80.700-80.800
Stop below 80.420
Target near 81.480 – 81.600


DXY daily chart


DXY weekly chart


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