The Dollar index is pulling back after the Friday break out above 88.15. This back test is critical as bulls would not want to see another fake break out and reversal as this would imply that a deep correction is starting. A short-term trend remains bullish and the bullish flag pattern continues to be valid.
Black lines = consolidation range
The Dollar index is above the cloud support which is very thin. This is not a good sign. Support is at 87.80. Resistance is at 88.30. As long as the Dollar index remains above 87.50, the trend will remain bullish and we will continue to have 91 as a target.
The Dollar index remains in a bullish trend in the daily chart as long as price is above 86.50. The cloud indicators remain bullish and the bullish flag patterns point to 91. Trend reversal will occur if the index closes below 87.
The material has been provided by InstaForex Company - www.instaforex.com
