The June U.S. dollar index futures at the New York Board of Trade last week hit a fresh contract low of 83.41. The index bears are in full technical command as an accelerating downtrend line is in place on the daily bar chart, from the March 10 high of 90.79. Below present price levels in the June dollar index, there is no near-term technical support to stop prices from sliding to solid longer-term technical support at the 2004 low of 80.48, basis nearby futures.
However, if nearby U.S. dollar index prices do drop to the 2004 low, there is a very strong technical support zone located between the 2004 low of 80.48 and the 1992 low of 78.43. In the last 20 years, nearby U.S. dollar index futures prices have pushed down into this support zone four times, but have never penetrated the zone on the downside.
For the bulls to regain some near-term technical momentum, they would have to push and close June U.S. dollar index futures above resistance at the 85.50 level. Above that lies resistance at the 86.00 area. On a longer-term technical basis, bulls would have to push nearby U.S. dollar index futures back above strong longer-term chart resistance at the 2005 high of 92.53 to regain some longer-term technical strength.
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