In previous posts we talked about the possibility of the Dollar index repeating a similar bullish pattern that was exhibited in 2018. The Dollar index weekly chart provided similar RSI bullish divergence and at the same price levels as it did in late 2020 and the beginning of 2021.
Blue line - expected path
Black line - resistance
The Dollar index bounced both times price reached close to the 89 price level. Both times the RSI provided bullish divergence signals and both times price bounced. The first bounce in 2018 pushed price from 89 to 103. So far price only bounced towards the 93 level. Price has made a double top at the 92.85 area and a break above it will be a bullish signal and price could continue its blue path similar to the bull run of 2018. Traders need to be cautious because soon we could see an important bullish signal.
The material has been provided by InstaForex Company - www.instaforex.com