FX.co ★ USDX: Daily analysis for October 18, 2013

Daily chart: Finally, the USDX managed to break the support at the 80.11 level, and it is now very likely to fall to the support at the 79.19 level. However, it is likely that the USDX begins to form a higher low pattern. However, there is still the possibility that the USDX conduct a bullish rebound at the current levels and rise again until the resistance level at 80.11. The MACD indicator is entering neutral territory, so we must be cautious.

H4 chart: The USDX is trying to break the support level at 79.63, with the formation of a higher low pattern. If the USDX manages to break that level, it is expected to fall to the level of 79.25. On the other hand, if the USDX makes a bullish rebound at current levels, it would be expected to rise to the level of 80.06. The MACD indicator remains in negative territory and entering extreme oversold zone.

H1 chart: The USDX has been consolidated below the 200-day moving average and now, the USDX is forming a higher low pattern below resistance at the 79.88 level. If the USDX breaks though the support at the 79.64 level, it would be expected to drop to the level of 79.64. On the other hand, if the USDX manages to break the resistance at the 79.88 level, it would be expected to rise to the level of 80.15. The MACD indicator remains in positive territory.

Trading recommendations for today: Based on the H1 chart, place sell (short) orders only if the USDX Index breaks a bearish candlestick; the support level is at 79.64, take profit is at 79.39, and stop loss is at 79.89.