The Dollar index has made a double bottom as expected at the important support of 79.95. The Dollar index was in oversold area as we mentioned in our previous analysis. This justified the bounce we were expecting. The Dollar index is rising again above 80 and is targeting the 38% Fibonacci retracement at 80.45. This is our short-term target. The Dollar index has broken out the downward sloping channel and this is something that confirms our bullish view.
The Dollar index is expected to find short-term resistance at the black upward sloping trend line resistance. At this resistance, prices got rejected the last time we reached the trend line. Now we expect the Dollar index to break above this trend line.
The daily chart confirms our bullish view as there is a bottom formation complete at 79.90-80 range and we now expect a bounce at least towards the 38% Fibonacci retracement. Our target for this bounce to complete is the resistance area at 80.60-75. We remain bullish.
The material has been provided by InstaForex Company - www.instaforex.com
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