US Dollar Index: While the corrective weakness triggered from the 79.83 level, its Oct 04’2011 high remains intact, the Index’s former resistance turned support at 76.71 may provide a considerable support when tested. The Index now faces price hesitation ahead of that level and its ability to maintain above the 76.71 level will suggest a halt in declines and a possible bounce higher. However, if that level is breached, the Dollar Index will face further downside pressure towards the 73.42 level, its July 27’2011 low. Further down, the key barrier stands at the 72.69 level, its early May’2011 low. Its daily RSI is bearish and pointing lower supporting this view. Alternatively, the Index will have to break and hold above the 79.83 level to annul its present corrective bear threats. This will bring further gains towards its Nov’2011 high at 81.44. Above here will set the stage for a run at the 83.55 level, its Aug’2011 high. All in all, with the Index continuing to retain its bearish tone on corrective weakness, further weakness is likely.
