Dollar Index Technical Analysis for March 17, 2016
The Dollar index made a new low yesterday breaking the triangle pattern downwards after the FOMC meeting. Trend remains bearish as we approach the important support area of 95. Price remains inside a longer-term sideways trading range with no clear direction for the longer-term.
Red lines forms a triangle pattern. The Dollar index has broken the triangle pattern downwards and is now going to test next support area of 95. If price breaks this level, we are going to test 94 and even lower. Trend remains bearish as price remains below the Kumo (cloud) and is making lower lows and lower highs.
Blue lines from a sideways channel.
Oscillators in both charts are oversold. In both charts we have bullish divergence signals. This is just a warning for bears. Price could move very well towards the lower blue channel boundary and the lower boundary of the weekly Kumo near the 93 level before reversing. With the triangle broken and the bearish momentum, it is very probable that this downward trend moves towards our target area of 93. Confirmed bullish reversal and a new upward trend will be confirmed only if we break above 98.50.
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