The US Dollar Index fell during most of the session on Tuesday. However, by the end of the trading day we saw a bounce off of the all-important 81 handle to prove it has been supportive yet again. Currently, we are looking at the market as having an 81 handle as the floor, and the hammer that fired off for the Tuesday session certainly does absolutely nothing to dissuade us from thinking this.
We think that the massive consolidation that the US dollar has gone through over the last several months will continue. If we can manage to break above the highs from the Tuesday session, we think eventually we will hit the 84 handle. It won’t be a straight move up, rather a long and protracted fight to the highs.