There are no major changes in the dollar index as prices continue to slide downwards in a downward sloping triagnle. Support is found at 80.45-50 and resistance is found at 80.65-75. Current price action is corrective and we believe we should remain neutral until we receive a bullish signal. This bullish signal will be given once prices break above the downward sloping channel.
Both blue and red short term channels pose strong resistance to the dollar index prices. Pressures to the downside are strong and unless we see an upward break above 80.75, we cannot talk of the end of the downward correction. The bigger price pattern looks corrective from 81.30 as there is no clear impulsive move. However, trend is down as the prices make lower lows and lower highs.
The daily chart shows clearly the downward sloping triangle pattern. Prices hover above the 38% retracement. If the bigger trend was down, then prices would have already reached the 61,8% retracement. Therefore this delay is in favor of the dollar bulls. Prices are eventually expected to break upwards and make new highs above 81.50. So we wait for a bullish break out in order to enter long and ride the new bullish trend.
