The Dollar index, as expected by our previous analysis, has picked up volatility and is trending upwards. After back testing the resistance at 79.80 prices have started an upward move that reached the 80.60-70 resistance area. Prices have paused the rise at that price level and are now pulling back.
Short-term trend is up as prices have formed a pattern of higher highs and higher lows. As long as prices trade above 79.90 we expect to see even higher levels being tested. Bulls will need to break the resistance trend line that comes from 81.50. The pull back could be an opportunity to buy again with 79.80-90 stop. Bulls will need to show more signs of strength by breaking above the 80.70 resistance.
The daily chart shows clearly yesterday's upward thrust after the FED announcement of its strategy. We expect prices to challenge the red area resistance and move towards our longer term target of 82.50. We remain bullish as long as prices trade above 79.80
The material has been provided by InstaForex Company - www.instaforex.com
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