The latest US Dollar Index rally has been met with a lot of conjecture around what it means, etc. It seems that most don’t believe in the rally and are expecting further weakness.
I agree on the possibility for near-term weakness in the US Dollar, but that’s a matter of technical analysis. I disagree, though, that it will be lasting.
I think we are setting up for something else. When looking at the chart below, do note the similar move up in PRICE and TIME earlier this year. This should lead to some back and filling. But a break above that downtrend line seems to be setting up nicely.
With this in mind, I think the pullback should be bought. That said, one could also wait for a breakout over the upper blue resistance line – a trigger for the next leg of the US Dollar Index rally.
US Dollar Index – Daily Chart
Thanks for reading and have a great rest of your week!
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