No surprise spike yesterday from the Fed and the Dollar is getting sold. Price showed us early signs in the morning by getting rejected at the horizontal resistance I pointed out in my last analysis. Price has broken through short-term support. The critical support level for bulls remains the 94.70-94.60 area.
Black line – resistance
Green line – short-term support (broken)
Blue line – long-term support trend line
Price has broken through short-term support and is testing the 4 hour Ichimoku cloud. Breaking below it will increase the chances of a test of the blue trend line support. Remember that each time the index reached this blue trend line support, big upward bounce followed. This has happened three times. Will there be a fourth or will we see a breakdown and a bigger sell off?
Green line – trend line support
Price is below the weekly cloud resistance. Yesterday’s pressure on the Dollar has brought the weekly candle back below the tenkan-sen (red line indicator). The line in the sand for bulls is the green trend line support. If this trend line is broken we should expect the Dollar index to move towards 92. Overall there are more bearish signs for the Dollar than bullish ones.
The material has been provided by InstaForex Company – www.instaforex.com
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