The Dollar index had reached important support levels and was oversold. A bounce was expected as in our previous analysis towards 80.20-40. After making a low at 79.95, we see the index trading above 80 again near its first short-term target of 80.20. We expect this upward bounce to continue higher towards 80.40-50.
Short-term resistance is found at 80.25 where the previously broken black trend line is. We expect the index to rise higher and meet the downward sloping channel trend line near 80.40. Short-term support is found at 80.05 that if broken we could see a back test of the lows.
The daily chart shows clearly the bounce we were expecting is taking form. We believe that the bounce will last a couple days more and we could see the bounce reach even 80.60. Concluding, we remain bullish above 79.95 with the 80.40 target.
