Technical outlook:
The US Dollar Index seems to be preparing for a drop (may be a correction) towards the 96.70 levels going forward. The index is trading around the 97.45 levels for now and has broken below its trend line support as presented here. Intermediary resistance is seen at the 98.30 levels for now and till the time prices are lower, bears are expected to push the prices towards Fibonacci 0.618 support at the 96.70 levels. Structurally, the US Dollar Index might be in its final stage of a major top formation and it is a matter of time before bears take full control. On the flip side, price breakouts above 98.10 and then above the 98.30 levels would bring the 100.00 levels into focus before a major top is formed. For now, a safe trading strategy implies to remain short against the 98.30 levels for a corrective drop towards the 96.70 levels.
Trading plan:
Remain short @ 97.45/50, stop at 98.30, target at 96.70
Good luck!
The material has been provided by InstaForex Company - www.instaforex.com