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Talking Points:
- US Dollar Technical Strategy: Holding Long via Mirror Trader Basket **
- Support: 10513, 10489, 10456
- Resistance:10560, 10606, 10663
The Dow Jones FXCM US Dollar Index may be setting up for a pullback after rallying as expected having put in a Bullish Engulfing candle pattern. The emergence of negative RSI divergence below resistance at 10560, the 50% Fibonacci retracement, warns of ebbing upside momentum. A daily close below the 38.2% level at 10513 exposes a rising trend line established from the July 1 low, now at 10489. Alternatively, a push through resistance opens the door for a test of the 61.8% Fib at 10606.
Our long-term US Dollar outlook calls for a broadly stronger US Dollar against its major currency counterparts. With that in mind, we are holding long via theMirror Trader US Dollar currency basket.
Daily Chart - Created Using FXCM Marketscope 2.0
** The Dow Jones FXCM US Dollar Index and the Mirror Trader USD basket are not the same product.
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
