A Trendless Dollar

In my alert on June 11th I presented two charts of the US Dollar Index. One provided a bullish interpretation, while the other was bearish.

I explained in that alert how the dollar was sitting "on the edge". More than six weeks have passed, and the dollar is still sitting on that same edge. The US Dollar Index has been stuck on either side of 86. Since June 11th the Dollar Index has been confined within an 87.01-to-84.98 range.

Here are the two charts I presented in the June 11th alert, updated through today's close. This first one is the bullish chart.

This chart presents a bearish interpretation of the Dollar Index.

Though the dollar has been trendless, the above charts are still presenting an important message. The dollar bulls have so far failed to prove their case. Look at the bearish chart immediately above. The Dollar Index has not managed to climb back above the green line marking the 2-year uptrend channel. I therefore expect that it won't be too long before the Dollar Index begins falling away from here, and a close in the Dollar Index below 84.00 is likely to start a rout in the dollar.

Published by GoldMoney
Copyright © 2006. All rights reserved.
Edited by James Turk, alert@goldmoney.com

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