Tuesday, August 11, 2009

Dollar Index



A very interesting pattern seems to be emerging on the $ index – that of a price divergence, meaning that while the $ price (green line) has made a new low; the MACD indicator given at the bottom of the chart has not made a corresponding new low. This is indicative of the decreasing downside momentum in the dollar, suggesting that the odds favor short term dollar strength. A break above 80 would serve to cement dollar bullishness.

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