We have been U.S. dollar bears the last few weeks as the index had a bear flag pattern that broke near the 96.00 level and then some multi-year trend lines below the 94.00 level. However, the last low yesterday came with a divergent RSI after we tagged the previous range’s 127% Fibonacci extension. The reversal today with close back above 92.50 puts in a false breakdown. This could allow for a test of the 94.00 level resistance and possibly (depending on what macro/market events are happening) could allow for a move back towards the 95.50 breakdown point. I guess the key takeaway here is: U.S. dollar bears should be careful here.
Chart Of The Day: DXY
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