The Dollar index remains in an uptrend after the breakout above 95.20. Short-term charts show some divergence signals that provide a warning for Dollar bulls. However, I believe that any pullback will be a buying opportunity and traders should not chase the market now but wait.
Red line – resistance trend line (broken)
Blue lines – trend line support
Price has broken above the cloud resistance last week and has provided us with a bullish reversal signal. Support is at 95-95.15 and resistance at 96. I believe we could see a rejection at the 96 level and a pullback which will be a nice tradeable buying opportunity with 94.50 as stop.
Green line – trend line support
Weekly support has provided the Dollar index with a strong bounce. Next important weekly resistance is at 95.85 and next at 96.50. At either level the chance of a rejection is high, so Dollar bulls should be very cautious. The 94-94.50 area is important medium-term support and should hold. Otherwise bulls will be in danger of losing even the 92 level.
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