Forex Analysis : USD Index
Global risk aversion obviously doesn’t include buying the US Dollar anymore, with a truly scary performance last week for the debased USD.
• Just holding at trend support, and with a double bottom on its day chart, we are unsure as to what it will take to move the Dollar upwards – apart from some pretty serious chaos in Europe or the UK.
• The dollar’s safe haven qualities were on leave last week, and we can imagine a scenario whereby global risk aversion dies down, stocks rally forth and the USD takes a fall to 75 or so.
• A rebound and daily close or two above 77.50 at the very least is required to repair some of the year to date damage on the chart, and for now the power of Bernanke’s nuclear printing press seems too much for the greenback to handle.