US Dollar update

As has been the pattern over the last view trading sessions, the US Dollar has become the whipping boy for the global forex trading crowd.

Today is was strength in the Euro which sent it lower. Talk is picking up that the next move in regards to interest rates by the ECB will be to raise them. That contrasts sharply with the situation around the US Dollar where rates will remain low for the immediate future.

Given this fact, it is difficult to make a case for the Dollar right now as it moves ever closer to a long term inflection point on the charts. It is sitting only a mere 40-45 points from this support level with the RSI not yet in oversold territory. That alone is rather foreboding.

Each blip higher in the Dollar has kept the RSI in a defined downtrend as indicated by the inability to break the downtrend line shown on that indicator.
Simply put, there is currently no strength in the Dollar. Keep in mind this is taking place against a backdrop where the Yen is being kept weak. Imagine where the Dollar would be had not the G7 intervention taken place?

I also happen to believe that is one of the reasons that made it easy for the G7 to agree to a round of coordinated intervention. It might have also been to help the Dollar also! Had the Yen not been taken down, the Dollar would have crashed through a major support level.