Dollar index has remained above the 50% retracement and the entire correction might already be over. Taking a look at its major component that is the EUR/USD, prices have reached the 61.8% retracement and the upward correction could very well be over with this pair. Therefore, the signals we get are that a short term at least bottom could be in.
The decline has reached the most usual retracement level and we believe it is worth a try to go long at 83 with 82.60 stop and 84 as first target. If the low is taken out, we could expect to go long near the 61.8% retracement at 82.10 if prices show bottoming signals there. But now let's focus on the fact that it is very possible that this is the end of the downward correction.
First, we would like for the recent low not to be broken. Secondly, we would like prices to break above 83.25. This will increase the chances that the correction is over. 83.75 is important resistance. We would like the upward move to have an impulsive price pattern to support our view. As always the way a price moves gives us many information and the next few sessions will clear thing up.
Concluding, we are slightly bullish at this level with 82.60 stop and targeting an upward move towards 83.75-84.
