I think this first weekly chart of the dollar really tells us all we need to know about which side of the fence we should be on. Since breaking through long term support in March it’s been a game of up and down as it retests and remain below that key level. Until the dollar can put in some serious buying that pushes the RSI in the overbought territory, I would be suspicious anytime the RSI gets to 60 and short there, especially if the chart is below the lower trendline that has proved to be resistance since April.

This daily chart shows a wedge pattern that will be the first sign of the short term direction. The fact that it broke out and quickly reversed is a bad sign for the dollar bulls. Let’s see how it reacts at support in the coming week.

This three line break chart attempts to smooth out some of the volatility, and you can see that the dollar is trying to break above the May high. If it can break above $76.10 and hold, then the next area of resistance is around $77.

From a macroeconomic perspective the dollar should just continue to plunge be it’s important to pay attention to the price action and if this chart improves then it’s possible the dollar could rally in the short term, which would probably fizzle out around the $81 range (Dec 10′ highs)

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