US dollar index price trend today

dollar index daily chart
USD Index – Daily Chart

The US dollar index continued to slide lower during the US futures trading session, testing the 79.00 level on the daily chart before bouncing off this price point, and recovering to close at 79.30, extending the recent bearish trend further. The price action for the index reflected market sentiment, with equity markets initially attempting to rally before closing lower as positive market sentiment waned later in the day, with the USD index recovering some of it’s early losses.

Negative sentiment for the dollar index has remained firmly in place since late November, signaled by the transition in the daily trend from bullish to bearish, which was duly mirrored on the three day chart, with the trend there also moving to bearish in the first week in December. The volume on the three day chart has also seen the sellers firmly in control since late November, and only the daily chart has seen any attempt by the bulls to buy into a falling market. Volumes over the last few days have been declining however, reflecting the lack of interest at present, as many investors and traders stay firmly on the sidelines, as they await the decision from the US Authorities on the so called ‘fiscal cliff’. As suggested in previous market analysis, the effect on the US dollar may be an interesting one, should the worst happen, with a flight to safe haven assets, and a consequent reversal in trend for the dollar now an increasing possibility.

From a technical perspective we are now approaching another key area of potential support in the 79.00 region, and indeed in today’s price action, the market has rebounded from this level. This area has been the springboard for previous reversals, and with several isolated pivot lows at this level in September and October, we could see the index find some traction, before recovering to move back and test the 80.00 level. However, if 79.00 level is breached with any conviction, then expect to see the US dollar index move lower once again, with a possible test of the 77.00 area last seen in November 2011.

By Anna Coulling

About Anna 1036 Articles
Hi – my name is Anna Coulling and I am a full time currency, commodities and equities trader. I have been involved in both trading and investing for over fifteen years and have traded many different financial instruments, from options and futures to stocks and commodities. I write and publish articles ( mostly for free ) for UK and international publications on a wide variety of financial issues, and in particular I enjoy helping others learn how to invest and trade.

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