Is the Dollar’s Rally Losing Steam?

02/02/2010 9:54 am EST

Focus: FOREX

Thomas Aspray

, Professional Trader & Analyst

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In early December, (click here for article) there were strong signals that the dollar was ready to rally. The dollar index appears to have stalled below the 38.2% resistance at 80. The daily chart shows an apparent continuation pattern, and a daily close below 78 would be a short-term negative. Technically, it still looks as though the dollar is forming an intermediate-term bottom, but a test of the 75.50-76.50 area is still possible. A dollar decline corresponds nicely with the positive signals on gold.

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