The Dollar index is making a pullback after the gap up on Monday. Trend remains bullish and is very strong so traders should avoid betting against it. The weekly chart shows an important upward break out above the long-term resistance of the 38% retracement.
Purple line = support
The Dollar index remains above the purple trend line which is important short-term support. The tenkan-sen indicator has been broken but this is a sign of weakness only for the short-term. This means that we could see a pull back lower towards the kijun-sen at 90.80 before resuming the up trend. Medium-term support is at the green area where the Ichimoku cloud is currently at.
The weekly chart is very clear portraying the dollar strength. The 38% retracement has been broken upwards and unless this is a fake break out(we will know very soon), this upward move is expected to continue towards the 50% retracement. So there is still much more upside potential for the dDollar. It is just making a small pause.
The material has been provided by InstaForex Company - www.instaforex.com
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