DXY Possible Double Top formation and rejection lower


The U.S. Dollar Index got rejected yesterday on the 96.900 Resistance, having made what is so far a Double Top. Technically a rejection follows after such a pattern but this time the pattern is spoiled by the pivot trend-line which provided today support and a bounce, as it did on November 30. As long as those two (Resistance and Pivot) hold, the price will be trading within this Triangle formation.

A recent long-term analysis I did on the DXY, comparing the current situation to mid 2018, shows that the index is overbought and calls first for a sizeable correction before resuming the uptrend:

DXY 1W RSI hit its 5 year Resistance. -3% correction expected.

Under those parameters, keep an eye on the underlying Channel Up and if it breaks, the target 94.000. If that breaks too, then the correction should aim at the 1D MA200 (orange trend-line), which has been untouched since June 17.

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