Dollar Index Finding a Bottom?
Feb 01, 2012
Today we take a look at the Dollar Index following two weeks of selling. This has certainly helped grains rebound after the January 12th USDA WASDE report, and the relative strength of the Dollar will impact export sales as we move toward planting.
On January 19th we broke below support that was established back in early October. Since this move, the Dollar index has traded lower 5 of 9 trade days, with the biggest moves being to the downside. In the last three trade sessions we have deviated from this new downward trend, and the dollar index looks to be settling into a range between 78.5 and 79.5 that we traded during November.
You can see from the RSI on this chart that this contract is still not oversold. At the time of this post the RSI is at 39, and technical traders look for a move below 30 before considering a contract to be in over-sold territory.
These technical levels won't be able to stop any big news out of the Euro-zone, but they can be useful when thinking about near-term price action. If you would like to get the Firetip platform shown below in your home today, click the red button below to start your demo!
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