USDX To Continue Bounce Towards 98.50

By Alexandros Yfantis of Trading2Day

Alexandros Yfantis • Jun 19, 2017 at 12:38 PM EDT

The Dollar index is mainly moving sideways since mid-May and we need a break above 97.50 to confirm a short-term at least reversal that will bring us towards 98.50-99.

Greetings everyone….as you all know I have been bullish or at least neutral the Dollar for the last couple of weeks expecting a strong bounce towards 98.50-99. The Dollar index is mainly moving sideways since mid-May and we need a break above 97.50 to confirm a short-term at least reversal that will bring us towards 98.50-99.

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The main drivers in the upcoming bounce will be USDJPY and EURUSD. EURUSD is unable to reclaim 1.12 and with a double short-term rejection at the cloud resistance on the 4-hour chart, I believe it is only a matter of time before we break 1.11 towards 1.10-1.09.

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USDJPY has broken above important trend line resistance and is heading towards the medium-term resistance at 112-113.

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NZDUSD is also at a pivotal long-term resistance area around 0.73 with rejection signs as we have been pulled back twice….0.7180 is key support, if broken we confirm reversal.

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USDCAD despite Oil’s decline has fallen towards a long-term support trend line. Will it move higher with Oil and confuse traders relying on its classical inverse relationship with oil? I believe so….

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AUDUSD

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Posting bearish divergence signals and a double top at 0.7635, once the red upward sloping TL is broken (0.7590) we should expect to see it test the Kumo at 0.7540 at least.

GBPUSD

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In a bearish channel but no bullish divergence on the daily chart. One more new low could be at hand before a meaningful move higher above 1.30.

Can’t be more clear than this….I would not be bearish Dollar here…and I prefer short EURUSD and long USDJPY for the coming days.

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