Our wave analysis yesterday anticipated a new short-term high above 80.15 and the Dollar index delivered according to our analysis. Prices bottomed at 79.85 and made an upward impulsive move that reached 80.35 as we foresaw. Short-term trend is upward and there is a potential to reach 80.60.
Short-term resistance levels are found at 80.65-70. Breaking above this price level will confirm trend change to upward as the sequence of lower lows and lower highs will be canceled. Instead, a new sequence of higher highs and higher lows will have started.
As mentioned yesterday, to change the longer-term trend, prices will first need to move back above the 80.70 - 81 price levels. The daily chart shows clearly that short-term trend has changed and it is challenging the intermediate-term trend. Stop for long positions should be at the intermediate low of 79.84. Breaking below that low will imply that the upward move is corrective and with only three waves complete. This will mean more downside should be expected towards the lows of 79.00 or even 78.50.
The material has been provided by InstaForex Company - www.instaforex.com
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