The US Dollar Index’s oversold recovery has struggled with the 20-day moving average, highlighting the failure to reclaim the upper portion of a multi-month bull channel. Also, the 10-day moving average (now @ 72.57), which had provided support since rebounding, has been breached with the latest retreat. A sustained loss will damage the dollar’s outlook and re-expose last week’s lows near 72.00. We recommend a short position (buying eur/usd) with a stop-loss above the 20-day moving average (72.94).
Strategy Summary : LONG USDX POSITION STOPPED OUT, SELL AT 72.60 FOR 72.06, STOP AT 72.94
SHORT EUR/USD POSITION STOPPED OUT, BUY AT 1.5727 FOR 1.5872, STOP AT 1.5687
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