8/26 - SHORT POSITION PROFIT TAKEN [+106 PIPS]

US DOLLAR INDEX:
The US Dollar managed to rebound off long-term (internal) trend-line support (connecting Nov 2005 & Aug 2007 peaks) to probe the 400-day moving average for the first time in over two years. To put things in perspective, the Dollar Index has still only retraced a third of its losses since 2005, only half of the overall bear move. More importantly, the EUR/USD, which failed to maintain a recovery above the 10 & 14-day MA's, is being supported by key long-term trend-line at 1.4580 (connecting 2005 & Aug 2007 lows). Our short position met the initial target, then the remaining half was trailed down to the 10-day MA and subsequently stopped for profit. If the EUR/USD can sustain a rally above the 10 & 14-day MA's (mid 1.47's), this would mark an overdue correction vs the US dollar.

Strategy Summary:
SHORT EUR/USD at 1.4805, 1/2 OFF AT 1st TARGET AT 1.4665 (+140 pips)
1/2 STOPPED FOR PROFT AT 1.4733 (+72 pips)

8/22 - SHORT EUR/USD FILLED

Strategy Summary:
SHORT EUR/USD at 1.4805, STOP LOSS at 1.4855, 1st TARGET 1.4665

8/21 - SELL EUR/USD AT 1.4965 OR 1.4805

US DOLLAR INDEX:
After setting a fresh 2008 high, the US Dollar Index has fallen back to a long-term internal trend-line at 76.03. Falling interest rates and a rebound in commodity prices have contributed to the Dollar's correction. This comes as no suprise, as the EUR/USD, which completed it's double-top objective at 1.4665, has now double bottomed and is currently back above it's 10-day MA near 1.48. Moreover, the USD/CHF & USD/JPY both failed to maintain key psychological levels (1.10/110), which led to USD/JPY to lose key support at 109.50 overnight. We remain cautiously optimistic with the US Dollar and will look to sell the EUR/USD at 1.4965 (former range top), where price-action is projected to meet the key 20-day MA. If long-term internal trend-line support with the US Dollar Index holds, then we recommend selling the EUR/USD on a break below the 10-day MA.

Strategy Summary:
SELL LIMIT EUR/USD at 1.4965, STOP LOSS at 1.5015, 1st TARGET 1.4665
SELL STOP EUR/USD at 1.4805, STOP LOSS at 1.4855, 1st TARGET 1.4665

8/20 - LOOK TO BUY USD (SELL EUR/USD)

US DOLLAR INDEX:
The US Dollar Index briefly probed the 77.35-85 region (December and January peaks) to set a fresh 2008 high. More importantly, the EUR/USD has completed it's double top objective (1.4670) and managed to recover to the 10-day MA (1.4803) after double-bottoming in the mid 1.46 region. Extreme oversold readings and negative hourly diverging studies, along with falling treasury yields and a rebound in commodity prices, all contributed to profit-taking in the US Dollar. We maintain our bullish bias towards the Greenback while above long-term internal trend-line support near 76.00 and if the USD/CHF & USD/JPY can maintain key psychological levels (1.10/110).

The US Dollar Index Strategy Summary: LOOK TO BUY USD (SELL EUR/USD)

8/15 - SELL USD (BUY EUR/USD)

US DOLLAR INDEX:

The US Dollar has exploded higher, marking the first time in years to substantially close above the 200-day MA. The pace, which has been extraordinary, is now showing signs of slowing with several hourly indicators demonstrating negative divergence. We recommend selling USD's in the 77.35-85 region, (December and January peaks) for a move back to the 10-day MA. This also would correlate with EUR/USD's projected double top objective (near 1.46) and is also where the 400-day MA lies. Moreover, with treasury yields falling and commodity prices showing some signs of a temporary base, these forces should cause the US Dollar to correct downward before resuming it's strength.

The US Dollar Index Strategy Summary: LOOK TO SELL USD (BUY EUR/USD)

8/10 - BUY USD (SELL EUR/USD)

US DOLLAR INDEX: Races through 200-day resistance

The US Dollar Index has surged through the 200-day moving average to probe key trend-line resistance. Early morning Friday saw the USD/CHF break through its 200-day MA and the Euro and Pound lose key support, underpinning the USD's first time above the 200-day MA in 20 months. Most of the US Dollar Index's success is attributed to the Euro's demise. A loss of key support confirmed a major distribution pattern, namely a double top, providing a price objective near 1.46. Moreover, the EUR/JPY lost key 50-day support and is now threating its 100-day MA. While the EUR/USD is now in capitulation mode, caution is advised as daily studies are registering extreme oversold readings.


Strategy Summary: LOOK TO BUY USD (SELL EUR/USD)

8/5 - RE-BUY USD (SELL EUR/USD)

US DOLLAR INDEX: Thrusts through pivot, nears 200-day MA

July 18th " the US Dollar Index (could thrust) through a cluster of moving averages (10, 20, 100-day) and shift momentum towards the 200-day moving 74.44"

Strategy Summary: LOOK TO BUY USD (SELL EUR/USD)