The Dollar Index (DXU11) finds stability again in the ranges of 74.00 after it has hit critical support of 73.40 ranges. The US Dollar is trading mixed after President Obama announced a last minute deal to increase borrowing limit of the US which should avoid catastrophic default; the USD it is trading strong against the Swiss Franc and the Japanese Yen while the Greenback is trading weak against the Cable and the Aussie Dollar.
Historic correlation between DJIA Vs DX suggests the major trend is still bearish in the Dollar Index though short covering can be expected; only weekly close above 76.70 in case of DXU11 would result in long term trend reversal in the US Dollar where as weekly close below 73.40 would result in continuation of the bear trend, the major trend in the key equity index of DJIA is capped between 11930 and 12700-12800.
NYMEX October Crude (CLV11) is expected to remain range bound between $95.00 and $101.50, either side breakout would establish trend.
FX Pair Support 2 Support 1 Resistance 1 Resistance 2
EURUSD 1.4280 1.4330 1.4445 1.4510
USDJPY 76.50 77.00 78.00 78.20
GBPUSD 1.6280 1.6360 1.6470 1.6500
USDCHF 0.7850 0.7900 0.8000 0.8050
EURJPY 109.50 110.60 112.00 112.80
AUDUSD 1.0890 1.0960 1.1110 –
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