Da Dollar

The dollar is looking weaker lately. On a daily level, there has been a strong bearish divergence with the MACD since the last run up. Currently, the dollar is sitting a little bit above its 50EMA. This more then likely will not hold if the downtrend continues. There is also resistance at 80. Both RSI and MACD look like if the downtrend of the dollar continues they will roll over. But beware of the strong trendline since July 08, this wont go without a fight. If the dollar breaks this, it would be time to short


Looking at the weekly chary you can see that it formed a "Shooting star", which is bearish. As well as MACD bearish divergence. There was also a "sell signal" cross of the MACD during the last decline of the dollar.



If we look at the EUR/USD. The EUR is finding support at this level and has retraced back from its last break out, so it could be setting up for another break out.


If you think there is weakness in the dollar, for a short-term play you could get away with shorting here, i.e, Shorting UUP or Buying UDN. I would feel more comfortable waiting to see if it can break that trendline, this will coincide with weekly chart breaking down as well.