The US dollar index is trading inside a bullish channel. There are several warning signs that between 98.50-99 we should expect a pull back as we are at overbought levels and several divergence signals are given. This is not the time to be buying dollars.
Red line - long-term support
Short-term support is found at 98.25 while resistance lies at 99.45. Price remains above the short-term support depicted by the Tenkan-Sen (red line indicator). A 4 hour candle close below the Tenkan-Sen will give a bearish signal for a move towards the lower channel boundary at least and the Kijun-Sen (yellow line indicator) at 98.25.
Green line - support trend line
On a weekly basis, trend remains bullish after breaking the 96.50 level. Resistance comes at 99.50 and support for the entire bullish trend at 95. A pullback towards 96.50 is justified. However, a push below and inside the Kumo cloud will be a bearish sign. Bulls do not want the price breaking below the green trend line support. This will imply that 92 will be tested.
