The Dollar index makes more of a sideways move inside a certain price range and there is no clear trend. The Dollar index has broken out of the upward sloping channel. This is a bearish sign. Bulls should be very cautious as a pull back lower is very possible.
Short-term support is found at 81.40. Short-term resistance is found at 81.70. The ichimoku cloud is very thin and this is a bearish sign. This means that there are increasing probabilities of breaking below 81.40 soon. Breaking below 81.40 will push price towards 81.
The upward sloping channel is now broken. The 5 wave upward pattern may be complete but the final wave 5 is still mixed and not a clear pattern. This could mean that we are still inside wave 4. Soon, we will know if the sideways move between 81.70 and 81.30 is a corrective wave 4. Important support for the Dollar index in the daily chart is found at 80.90. A daily close above 81.50 will also be a bullish sign and that the Dollar index remains supported.
The material has been provided by InstaForex Company - www.instaforex.com
