Technical Analysis of USDX for April 12, 2016
The Dollar index continues to grind lower and still remains in a bearish trend. However, I expect the trend to reverse this week or, at the latest, at the start of next week. I expect the Dollar to strengthen again.
Red line - resistance
Black lines - divergence signs
The Dollar index remains below the 4-hour Kumo (cloud) and continues to make lower lows and lower highs. Resistance is at 94.66 and at 95.35. Breaking above the latter will confirm the bullish reversal. Support is at 93.
Blue lines - sideways channel
As expected, the Dollar index is approaching the 93 support of the lower cloud boundary and the lower channel boundary. Stochastic is at oversold levels and at least a bounce towards the upper cloud boundary at 96 is justified for the short term. I prefer to be neutral or bullish on the Dollar index at the current levels and as long as it trades above 93.
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