US Dollar Index (DX) Futures Technical Analysis – Crossing to Weak Side of Gann Angle at 92.06 Extremely Bearish

September U.S. Dollar Index futures continued to tumble on Monday in response to the speeches by Fed Chair Janet Yellen and European Central Bank President Mario Draghi on Friday at the Jackson Hole central bankers’ symposium.

Also weighing on the U.S. Dollar were concerns over the economic impact of Hurricane Harvey on the national economy.

The Greenback extended its losses against a basket of currencies, especially the Euro, in reaction to the speech by Yellen after she failed to mention monetary policy. Traders interpreted this to mean that she had nothing new to say about the economy and the timing of the next rate hike. This likely means the FOMC will have a hard time garnering enough votes to raise rates in December.

Draghi drove the Euro higher after he refrained from mentioning any concerns about the value of the Euro.

The impact of Harvey was also weighing on the U.S. Dollar. Houston, Texas is being paralyzed by the impact of the storm. Since it is the nation’s fourth biggest city, its economic losses are likely to be felt throughout the nation.

Weaker U.S. Treasury yields also weighed on demand for the U.S. Dollar.

Technical Analysis

The September U.S. Dollar Index is accelerating to the downside after taking out the August 2 bottom at 92.390.

The next target is a steep downtrending angle, moving down at a rate of .25 per day from the 94.055 main top. This angle is currently at 92.06. We could see a technical bounce on a test of this angle, but it should not be considered support. It is a directional angle.

Crossing to the weak side of the angle at 92.06 will put the index in an extremely bearish position. This could lead to an acceleration to the downside and an eventual test of the May 3, 2016 main bottom at 91.45.