The rise in the Dollar index is very fragile. A double top and a rejection at the previous highs is not a good sign for bulls. The upward sloping channel is being put to the test. The Dollar index is now testing important support levels.
In the short-term, the Dollar index is testing the top end of the Ichimoku cloud and the lower boundaries of the upward sloping channel. The double top is not a good sign for bulls. Support is found at 81.45 and at 81.35. Breaking below these levels will certainly push the index towards 81.20 and maybe 81. Resistance is found at 81.75. If broken, we will push towards 82.
This is my wave count for the daily chart in the Dollar index. Is the upward impulsive move over? As long as price is inside the upward sloping channel, we assume wave 5 is not complete yet. If price breaks below 81.35 and closes for a day below that level, we assume that a correction will start that could push the index as low as 80.50. The trend remains up but it is fragile. The Dollar index is testing the support of the channel and bulls should be very cautious.
The material has been provided by InstaForex Company - www.instaforex.com
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