The US Dollar Index is reversing lower as we expected from the 78.6% Fibonacci retracement. The index is going to test the cloud support at 94.90-94.70. If this support is broken, we should expect a test of the recent lows at 93.
The US Dollar Index reverses from the 78.6% retracement. The price is above the Ichimoku cloud and above the kijun-sen indicator (yellow line). Bulls are still alive as bears are trying to regain control in the market. Support is at 94.90 and 94.70. Resistance is at 96.30. A daily close above 96.30 will push the index towards 98.30.
Red line – resistance
Green line – support
The US Dollar Index got rejected at the kijun-sen this week (yellow indicator) and should move towards the cloud support or even the green trend-line support. The 38% retracement is my target. I remain short-term bearish but without taking my mind away from the bullish flag pattern that is being formed.
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