The US Dollar (USD) continues to strengthen as witnessed by the US Dollar Index. (Refer to last week’s blog on the index.) Today the Dollar broke out of a trading range it has been in since the end of July. With the move today, the Dollar is at a level we have not seen since last September. Since the low point of the year in early May, the Dollar has made a steady climb with the exception being at the end of June. Since that time, the climb has been much more accelerated.
Today’s move seems to be attributed to the numbers from the Consumer Price Index. Although the numbers are basically the same as previous numbers and in line with the forecasts, the Dollar moved. The news did not derail what has been building over the last few months.
For most of the major pairs, the strengthening Dollar is reflected in some nice strong trends. Going with the trend continues to reward traders. Of the majors, only the Aussie & the Yen seem to be immune to strong trends. Both of these currencies are trading in a range for the last several months. Although they are trading within a range, the range is rather large. Therefore, there are some good opportunities to make some support/resistance trades while they continue to trade in the range.
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