FX.co ★ Technical analysis of USDX for August 2, 2016

The Dollar index bounced yesterday as we expected but remains in a bearish short-term trend with many chances of making a new lower low towards 95 in order to complete the corrective pull back from 97.30.

Blue lines - bearish channel

The Dollar index is trading between the 38% and the 50% retracement levels inside the bearish channel. Price bounced yesterday and I expect a new lower low towards the 61.8% Fibonacci retracement to be seen over the coming sessions.

Resistance is at 95.90-96 and only a daily close above this area could signal a bullish reversal in the short-term trend. In the weekly chart price is testing the kijun- and tenkan-sen support at 95.30. I believe a move towards 95 will complete the pull back and the up trend will resume. Important low at 93 should not break for bulls to keep their hopes alive.