11.02.201412:26 Forex Analysis & Reviews: #USDX Technical analysis for February 11, 2014

The Dollar index continues its bearish trend as it has not managed to break above short-term resistance levels at 81. We are bearish this index since it was above 81.20 and got rejected at 81.40-50 once again. Our target was the lower support trend line near 80.15-20.

The index has now fallen below the 61.8% Fibonacci support and this is not a good sign for bulls. Next short-term support at 80.45. Short-term resistance is found at 80.80 and this is the stop for bears. We continue to prefer short positions and we look to close-take profits around 80.20-30.

The daily chart also shows the upward sloping trend line support that we target in order to close our short positions. We expect the decline to pause at that level and maybe see a reversal upwards. The longer-term price pattern of the index is sideways and we continue to see 81.50 as a level that if broken we should play the long side 100%. It is also good for longer-term bulls the fact that the index does not fall below 79. Below 79, the longer-term outlook for this index will be very bearish.