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12.10.201609:16 Forex Analysis & Reviews: Technical analysis of USDX for October 12, 2016

Long-term review

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The Dollar index has broken above critical trend line resistance. Price is in a bullish trend and looks ready to challenge the previous highs. 98.60 is the next important hurdle to surpass in order to continue higher. Short-term view justifies a pullback.

Dark blue lines - bullish channel

Blue line - critical long-term support

The Dollar index is testing the upper channel boundary. With oscillators overbought, I expect price to get rejected at current levels and pull back at least towards the lower channel boundary at 97. Price is above the Ichimoku cloud and this confirms the bullish trend.

Red line - resistance

Green line - long-term support

Price has broken above both the weekly Ichimoku cloud and the downward sloping red trend line resistance. Next resistance is found at 98.60 where the 78.6% Fibonacci retracement of the decline from 100.50 to 91.90. Only a reversal and a new low below this week's lows will be a bearish reversal signal. All other pullbacks are considered to be buy opportunities.

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