The Dollar index has broken the short-term consolidation and has pushed higher to new highs getting closer to our 91 target from the bullish flag pattern. A trend remains bullish. Support at 89.50 is critical for short-term.
Green line = support
Red lines = sideways consolidations
The Dollar index has broken yet another sideways consolidation to the upside. As I mentioned yesterday, a move above 90.18 would signal a break out and the start of another upward move that will bring us closer to 91 which is our target for some time now. But lets look at the bigger picture as the bullish implications are big.
Red line = resistance
The Dollar index is depicted above in a monthly chart. Price has not only managed to break above the Ichimoku cloud resistance but has also broken the descending trend line resistance from 2009. The Dollar index has managed to reach and break above the 38% Fibonacci retracement of the big decline from 121. This means that we could reach even higher towards the 50% or even the 61.8% retracement of the decline. Assuming that this is good news for bulls, a healthy correction is always needed before resuming the up trend. So, we need to be patient and wait for a pull back near 84-82 to buy for the next leg up.
The material has been provided by InstaForex Company - www.instaforex.com
