The Dollar index had reached multi year highs and major monthly resistance as we explained in a previous post. Today's market reaction after the FOMC meeting was Dollar bearish as the Dollar index has turned from 103.70 to 102.60.
Blue line -monthly horizontal resistance
The Dollar index had an explosive bullish April with parabolic price action. May's FOMC is putting pressure on the Dollar index and the first signs of a rejection at the horizontal resistance are already here. Will the Dollar index continue trading inside the trading range of 89-103? Is the rejection temporary? As we said in previous posts, short-term market conditions were overbought and at least a short-term pull back was justified. There is potential to see a pull back towards 100 over the next few days but it is too soon to call a major top in.