The dollar could deepen its losses
UUP•The dollar index has fallen below its 21-day moving average, with technical analysis pointing to support around 100.7, 99.7 and 98.56. A rise above 102.95 would negate the bearish view.
1. Downward momentum
The dollar index has been losing momentum since mid-October after rising more than 7.5% from its lows to highs this year. Its Relative Strength Index has fallen from elevated levels since early October and appears headed below 50, while its Average True Range has risen as the index extended its decline.
2. Levels to watch
After falling below its 21-day moving average late last week, the index could test the 55- and 100-day moving averages, both around 100.7. Further support lies near the 200-day moving average at 99.7 and the August 20 low of 98.56. A drop below 99.36 would breach the dollar’s rising trend channel; a move above the October high of 102.95 would negate the bearish view.
