FX Daily Report: April 22, 2013
GFM Research | Apr 22, 2013 06:10AM ET
The Dollar Index (DX) is currently range bound between 83.40 and 81.80 with 82.88 acting as intermediate resistance. The medium term trend is intact till DX hangs on above 81.80; intraday support is observed at 82.50 ranges. Historic correlation between the bench mark equity index of Dow Jones Industrials (DJIA) and DX suggests positive bias is still prevailing for the US Dollar.
Dow Industrials (DJIA) is trading consistently beyond all time high of 14200-14300, a historic high made during October 2007. This indicates a new rally is under progress, but the momentum has run out of gas at 14400 ranges. Only a monthly close below 13700 would force us to rethink the bull trend.
The historic DX Vs DJIA correlation suggests the long-term trend is still Dollar bearish, but only while the Dollar Index doesn't close above 84.50 on a monthly basis. The short and medium term trends are bullish.
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