Good day forex trading koalas.
Welcome to another review on the US Dollar Index. This is a basic yet important index that is often overlooked by many.
We last visited this index on in Dec 10 and we noted a technical resistance of 80. Furthermore the US debt has increased and unemployment woes continued to plague the economy.
Looking at the latest US Dollar Index chart, we note that the index is testing the 78 support for now. From a technical point of view, if this fails, it may open up the index for a drop to 76.
From a fundamental point of view, this may be possible due to the overall easing of the fears surrounding the Euro Zone deficit crisis. Having said so, potential troubled spots such as the Middle East protests and Iran’s navy passage through the Suez Canal may trigger risk aversion again and hence a flight to the relative safety of US Dollar assets.
On the home front, the US economy is enjoying an apparent positive outlook. Various consumer and economic indicators are doing good and the unemployment rate has dropped. Having said so, the US Federal Reserve indicated that a sustained period of good employment should be seen first.
On 09 Dec 10, the US total public debt is at 13,846,494,847,569.86. As of 17 Feb 11, the figure is at 14,123,589,307,190.53.
The US debt has increased.
Many economic experts believe that much must be done to curb this debt otherwise this is a dangerous time bomb which will threaten to bring the US economy to it’s knees in time to come. It is a vicious cycle since as the debt situation gets worst, the tougher it becomes to refinance the debt.