FX Daily Report: May 31, 2013
GFM Research | May 31, 2013 03:11AM ET
After trading sideways between 84.50 and 83.50 for couple of weeks, the Dollar Index (DX) closed below the support of 83.50 ranges to slip to interim support of 83.00 ranges; consistently trading below 83.50 would drag the index further to 82.45 ranges. The U.S. dollar depreciated across the board, especially against the Cable, the Common Currency and Swissy. The Yen is looking overstretched at 102.00 ranges, and the Aussie is trading tight near the multiyear support of 0.9400-0.9500 ranges.
The benchmark equity index of the Dow Jones Industrials Average (DJIA) seems to be overstretched, although the major trend is still intact till DJIA manages to trade above 14860 ranges. 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 88.40 on a monthly basis with 84.50 ranges acting as intermediate resistance.
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