USDX

Seems to be quite an interesting symbol to watch recently. Unfortunately I don't have real time and intraday charts, but on daily, weekly and monthly it seems that the buck basket is running out of space. It is becoming set more and more into a wedge like formation with borders standing currently not more than 200 pips from each other, which is less than the average monthly range. Perhaps we are about to see it to explode with a move similar to those on the JPY crosses seen this year after carry trades liquidation. I would say that the break of the upper border is more likely and going to be quite wild. Seems October has a chance to become the most volatile month of this year for the buck.

Here's the daily chart (with signals removed). From this perspective it's lower highs and lower lows. The interesting point about this chart is that the USDX is lower than it was in 2004 when the Japanese routinely intervened and manipulated the currency sometimes with rumor and sometimes with cash. I'm not a fundamentals guy but a lower dollar hurts the export of of Asian products. I'm not sure why they wouldn't seek to stabilize this slide.

How about this (monthly) ski slope: