The US dollar index has broken the short-term support at 38% Fibonacci retracement and is moving lower to test the 50% retracement. Big support at the 61.8% Fibonacci retracement. A trend has reversed to bearish and we are now looking for a deep pullback if the 61.8% Fibonacci retracement fails to hold.
Blue lines - bullish channel
The US dollar index has not only broken the bullish channel, but has also broken below the 38% Fibo and the Kumo (cloud) support. The trend is bearish in the short-term. Short-term resistance is seen at 97.65. If the price breaks above it, then we will see a bullish reversal.
In the weekly chart above, we see how the price has broken below the tenkan- and kijun-sen indicators. This implies that the Kumo (cloud) will be tested. The target is where the Kumo (cloud) and the lower triangle boundary are found. This intersection is at the level of 96. Breaking below it will open the way to a new low below 95.20.
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