The Dollar index has made a pause to its rise and is pulling back below 80 as expected by our previous analysis. The Dollar index is reversing lower towards our target of 79.85 and towards the Ichimoku cloud support I also mentioned last week. This supportive cloud should hold for bullish short-term trend to change to a longer-term bullish reversal.
It is very possible to see this pull back reaching the 38% Fibonacci retracement. This is a potential buy area for anyone who has taken profits from their long positions. It is important for the Dollar index not to break below the Ichimoku cloud and the 61.8% retracement.
The daily chart continues to show that the dominant trend is bearish. Price has hit the daily Ichimoku cloud and has been rejected. Only a strong break and close on a daily basis above this cloud will confirm daily trend change.
