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The higher commodity prices, along with fears of more action from the Fed, have pushed the dollar sharply lower. The dollar has reached an important band of support in the 79.60-80.20 area. This is not only an area of good chart support, but also the 61.8% support of the rally from last December’s lows. There is a band of resistance in the 81.50-82 area. The daily on-balance volume (OBV) is also at long-term support and is below its weighted moving average (WMA). The longer-term analysis has deteriorated, suggesting that the dollar’s rebound from the 2008 lows may just be an interruption in the downtrend.
Tom Aspray, professional trader and analyst, serves as video content editor for MoneyShow.com. The views expressed here are his own.
