Dollar Index Tests Important Support Level
Erik McCurdy | Sep 25, 2012 03:00PM ET
Early last week, our cycle analysis predicted the formation of a short-term low in the U.S. dollar index. As expected, the rebound off that low during the last six sessions has been relatively weak, favoring an eventual continuation of the violent decline from late July.
Following the breakdown of the rally from 2011 at the beginning of September, the index moved sharply lower and returned to congestion support in the 78.50 area.
Next Weeks Will Tell
The 78.50 congestion zone is a meaningful support level and market behavior during the next few weeks will likely provide an important signal with respect to intermediate-term direction.
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