The Dollar index has risen as expected from the 80.40-50 support area and is trying to reach the upper resistance levels of the downward sloping channel. The short-term support is found at 80.70 and at 80.55. Short term resistance is found at 81.10-20.
The Dollar index is forming a sideways triangle corrective pattern. The primary scenario we prefer is that this triangle has ended at 80.50 and has already started its first upward move. We expect it to move upwards towards 81-81.20 and break it after the pull back it makes today.
The daily chart confirms that prices remain in downtrend. Lower lows and lower highs pattern continues to prevail. Prices have reached the 100 day MA and did not manage to break above it. Closing above the 100 day MA is the first bullish sign we want to confirm an important low at 80.50. Concluding, we are slightly bullish as long as prices trade above 80.45-50. However bulls will need to show more signs of strength by breaking above 80.20. Until then we remain cautiously bullish. The downward move from 81.50 is corrective and soon we should see an upward breakout.
The material has been provided by InstaForex Company - www.instaforex.com
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