The Dollar index continued its sideways corrective move yesterday. The trend remains upward for the intermediate term and short-term trend is neutral. Prices are trading above the support levels 80.50-81 and we remain bullish biased. The price pattern continues to favor bulls as this sideways consolidation could be labeled as a bullish flag pattern.
Resistance is found at 81.30 and 81.55. Breaking above the 81.30 will confirm that the downward move is a correction. Breaking above 81.55 will confirm that the correction is over and that we are heading towards 81.70-82. The rise from 80.74 is looking impulsive and the start of a new upward move at its beginning.
Prices should remain above the short-term red trend line as shown in the chart above. We want prices to break above the recent high a 81.21 in order to pick up more bullish momentum and break above the 81.35-55 resistance levels. We are bullish as long as prices trade above 80.85 in the short term and 79 in the long term.
