The Dollar index made a new lower low as expected yesterday, since prices could not break above the resistance trend line we noted in our chart. The same trend line is being tested again today. If prices manage to break above 79.35, then there will be increased chances of an upward bounce towards 79.65-70. The 79.70 level is the next resistance level if 79.35 is broken upwards.
The short-term support at 79 if broken could give a push towards 78.80-50. The trend remains downward in all time frames and the index has a pattern of lower lows and lower highs that favors bearish positions.
The longer-term picture for the Dollar index continues to favor bears. Trend is down and there is no sign in the daily chart of a change in the trend or even a sign of a potential upward bounce. We remain short-biased, and we sell on upward bounces. Critical price level in the daily chart is the 80.70 level.
