Sunday, December 6, 2009

US Dollar Index (NYBOT:DX) spikes into reversal

While cautious to call a trend reversal, I'm observing a few technical points upon which I'm building an assumption a change in direction is most likely.

The US Dollar Index closed on Friday at 75.79 which is above the 50-Day MA (75.71) and also broke the long term Resistance trendline from the March '09 Highs. This goes along with a spike in RSI reading of 55.12 - first time since April and also a Buy signal from the Directional Movement indicator with the ADX pushing off the bottom to signal a possible acceleration of this counter trend move.

I'd like to see a continuation confirming the trend reversal with a possible first 76.85 November High and then the October High around 77.50. An intermediate term target would be set at the 200-Day MA now at 80.13.

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