The Dollar index finally broke above the 38% Fibonacci retracement level and has already reached our second target which was the 50% retracement. As we mentioned in previous posts, respecting the blue trend line and staying above it was key for bulls maintaining the control of the trend.
Green lines -Fibonacci retracement
The Dollar index has support at the 38% retracement at 94.50, which was previously resistance. The 50% retracement is our next target and resistance. We are almost there. Despite the new higher high, the RSI in the Daily chart has not given us a new higher high yet. Will we see our first bearish divergence? On a weekly basis the RSI has still not reached overbought levels nor has it made a bearish divergence. The 61.8% Fibonacci retracement was our major target from the beginning and so far I can not see why we should see the DXY reach that level.
