Dollar Index Technical Update 25/11/2012

Our dollar index update last week noted that the price of the USDX was trading just under a key near term technical level, comprised of the following elements:

- previous price structure support lows from June (see far left of the daily time frame chart – fig 1),

- a 50% corrective retrace of 72.69 – 84.1

- the highlighted FE 161.8 extension area.

- we also noted that “the corrective risk is that the the dollar is overbought in the near term”.

This technical confluence zone has held as resistance and the dollar index is now trading back at the previous range resistance highs from late October, which have provided initial support on the drop lower.

The price action around 80.00 is our near-term focus. More specifically, we want to see if price can hold above this area on the daily closing basis, after the strong bearish move on Friday.

2012-11-25 02:40:08

Source: http://www.traderslog.com/forum/showthread.php?t=21236&goto=newpost