The US Dollar index has made a nice move higher since the end of November with a gain of about 5%. The important part about this rally is that the index has broken the long-term downtrend that it had been in since early 2009. As shown below, the recent action in the Dollar looks a lot like the start of the rally that occurred in the second half of 2008. In late July/early August of last year, the Dollar gained a quick 5% out of the gate when it broke a multi-year downtrend. The currency went on to gain 25% over the next 7 months. Will the recent break of the downtrend be the start of a similar rally?
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