The Dollar Index was closed and reversed as important resistance at 81.25-35 was broken. EURUSD the major component of the Dollar Index could not manage to hold above 1.34 after the announcement of the FED Minutes and prices collapsed bringing strength in Dollar. Short term trend may have broken upwards but bulls will need to break above 82 for the trend reversal to be confirmed.
The upward sloping trend line should hold for the immediate continuation of the uptrend. Otherwise we could see a pull back towards 81.15-20 were bulls will be tested. First target for bulls will be the 81.90-82 resistance. Bears on the other hand are now in a difficult spot as the daily chart shows below.
The break of the supportive trend line could very well be a fake as prices are now trading above the downward sloping tren line the sets the intermediate down trend. If the Dollar Index manages to say above this downward sloping trend line and test 82, then bulls will have made the first important step to change the trend. Concluding, volatility yesterday brought a lot of spikes in Dollar prices yesterday without helping us get a clearer picture regarding the Dollar Index. We are bullish biased but we will want to see more strength above 82 to be more sure that the trend has changed.
