DOLLAR INDEX breaks key supports

The dollar index hit the lowest levels in two months on Monday, following eventual break of key 99.50 support zone (daily Ichimoku cloud base / trendline support) which recently resisted several attacks.

The dollar is in red for the second consecutive day, deflated by growing bets that the US central bank will keep interest rates unchanged in September, after key economic indicators showed further weakening of the labor sector and inflation eased in July.

Fresh weakness also violated the floor of the range (99.25/99.95) that extends into third week, with sustained break here to confirm bearish signals and (break of cloud base / trendline) and generate fresh signal of bearish continuation of the fall from 101.48.

Daily technical studies are almost in full bearish setup that supports near-term action for acceleration towards next target at 99.00 (200DMA / Fibo 61.8% of 97.44/101.55), guarding 98.67 (May 29 trough) and 98.41 (Fibo 76.4%).

Broken cloud base reverts to solid resistance which should cap upticks and keep fresh bears in play.

Res: 99.50; 100.00; 100.16; 100.31
Sup: 99.16; 99.00; 98.67; 98.41