2021 ended with the Dollar under pressure and the Dollar index showing reversal signals. Technically short-term trend in the Dollar index remains bullish as price continues making higher highs and higher lows, as price still respects the key upward sloping trend line support.
Blue line- support
Green lines – Fibonacci retracements
The Dollar index made a pull back the last couple of sessions of 2021 pointing to a bigger reversal. However price continues to respect the blue support trend line. In order to get a confirmed reversal, bears will need to break below the blue trend line support at 95.05. Price has so far retraced more than 50% of the entire decline of 2020. We successfully predicted the bullish reversal from the 89-90 price area. The area between 96.30-97.50 is key resistance and it is important to see how the market reacts at these levels. The upward move from 89.50 has paused around the 50% retracement. There is no confirmation of a reversal yet. Bears need to show more signs of strength.
The material has been provided by InstaForex Company – www.instaforex.com