The Dollar index has reached our upward target of 80.40 and reversed. Resistance at 80.40 proved strong for bulls and prices got rejected and the trend reversed downwards once again. Short-term support is found at 80 where the previous bounce started. Short-term resistance is found at 80.35-40.
The current upward bounce could have completed the any upside potential. Bulls should be very cautious at 80 and 79.90 support. If these levels are broken, things are going to get worse for bulls. We may find another opportunity to enter long at these levels.
The daily chart shows us why prices got rejected at 80.40. The upward sloping trend line that was once support and got broken is now resistance. Prices back tested the broken support and got rejected. This is bearish and we should expect the horizontal support trend lines to be tested.
