The Dollar Index remains in downtrend. Prices are being pressured to test the 80.80-90 support area. The resistance trendline as shown in the following chart remains above the current prices, confirming downtrend. The pattern of lower lows and lower highs confirms downtrend.
Although we believe that the trend should reverse upwards soon, we will not enter long unless we receive a bullish signal. This bullish signal will come if prices break above 81.50 in an impulsive pattern and above the downward sloping trendline. If that happens we will enter long with the recent low as stop.
Another day we mentioned how important for the longer-term trend this support is. The 81-80.50 support is very important if you take a look at the daily chart above, as the longer-term upward sloping channel has its lower boundaries support at that level. We remain, therefore, neutral expecting to enter the market on the long side as long as a bullish signal is provided by an upward breakout.
