Red lines- bullish channel
Blue line- bearish RSI divergence
The Dollar index is trading around 110 and price remains in a bullish momentum. Price is still inside the upward sloping channel from April of 2021. Price continues making higher highs and higher lows. So far price has respected every previous higher low and despite the warnings we get from the RSI, the up trend remains intact. The RSI has so far warned us twice with two lower highs, while price was making higher highs. This bearish divergence is a sign of weakening up trend but not a reversal signal as we have said before. Bulls need to be cautious and protect their gains. Current market conditions justify a reversal and a big correction (pull back) in the Dollar index towards 102-103. However price is in short-term bullish mode as long as we hold above 107.75.
