The US Dollar Index was rejected at its recent highs and pulled back towards the cloud support once again. The short-term trend remains bullish as long as the price is above 95.80. We are at a critical junction as support is very close and we should either see a strong downward reversal or a continuation of the uptrend.
Blue line – trend line support
The US Dollar Index is testing the upward sloping trend-line support and is above the Ichimoku cloud. Short-term support is seen at 95.80 and resistance is seen at 96.75. A break above resistance will open the way to new short-term highs around 98. A break of the support will put pressures on the index leading to the test of support at 94.50.
Blue line – trend line resistance
The US Dollar Index is back testing the breakout level of 95.80 in the weekly chart above and is also testing the Ichimoku indicators of kijun- and tenkan-sen. Support in the area of 95.80-95.70 is very important. A weekly close below these levels is not a good sign for dollar bulls.
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