The US Dollar Index (DX) may trade sideways with medium term

by Admin

Market Commentary

Amidst volatile trading witnessed across the asset classes, the US Dollar traded mixed wherein it as depreciated against European majors of the Euro, the Pound and the Swiss Franc but continued to appreciated against the Japanese Yen and the Aussie. The Dollar Index (DX) is getting range bound between 83.40 on the higher side and 82.40 on the lower side. The US Dollar Index (DX) may trade sideways with medium term and long term resistances seen 83.40 and 84.20 respectively; though the trend is still intact till it manages to hang on above 81.80 ranges the momentum is decreasing.

Dow Industrials (DJIA) is trading consistently beyond all time high of 14200-14300, historic high made during October 2007 indicating new rally is under progress but the momentum has run out of gas at 14400 ranges; only monthly close below 13700 would force us to rethink the bull trend.

Historic correlation between DX Vs DJIA suggests the long-term trend is still Dollar bearish till the Dollar Index is not closing above 84.50 on monthly basis though the short term and medium term trends are bullish.

Sideways-Up 1.3070 1.3030 1.2950 1.2900
Up 101.30 100.40 96.70 95.70
Sideways-Up 1.5420 1.5380 1.5250 1.5200
Sideways-Down 0.9430 0.9380 0.9290 0.9230
Up 130.80 129.50 126.00 124.00
Sideways-Down 1.0440 1.0410 1.0350 1.0320