16.05.201410:48 Forex Analysis & Reviews: #USDX Technical analysis for May 16, 2014

Long-term review

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The Dollar index has continued higher towards 80.40 yesterday where the first short-term resistance was. Price pulled back, so there are increased chances of this pull back continuing lower towards 79.70. The Dollar index might have made a short-term top and we could see this move lower towards the Ichimoku cloud support.

The Dollar index is above the Ichimoku cloud. Short-term trend is upward. Resistance is found at the 80.40-.60 area and support at 80-79.70. Currently I favor a pull back to re-energise bullish momentum. The most probable target for a pullback is 79.85-79.90.

In the daily chart above I see that price has stalled at the Ichimoku cloud where the strong resistance level is found as we mentioned yesterday. In yesterday's analysis we expected price to pause the rise inside the Ichimoku cloud and start a small pull back before a final break out above the Ichimoku and before we confirm the trend reversal. There are many signs that this trend is making an upward longer-term reversal. However I prefer taking long positions near 80 and below it when this pull back unfolds with 78.85 as stop.

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