The US dollar index has broken the short-term upward sloping channel and is showing signs of a short-term reversal. As I mentioned in my last analysis, it was highly probable to see a short-term pullback in the USDX towards 97. However, the longer-term trend remains bullish.
Black lines – bullish channel
The US dollar index has made a pullback yesterday and remains weak this morning. The price is expected to test the Ichimoku cloud, but at the same time, we see that it remains inside the bullish channel. Important support is found at 97-96.80 area and I believe it should hold and produce a bounce if tested.
Blue line – horizontal resistance
The weekly chart remains bullish despite the red candle and the pullback in the price. I was expecting a pullback to test support by the kijun-sen (yellow line). A weekly close above 98 will be the sign that the uptrend resumes. Bulls should be very cautious if the price breaks below 96.80.
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