FX.co ★ #USDX Technical analysis for October 21, 2014

The Dollar index continues its downward pullback towards 84 which was our target for this downward correction once 85 was broken. Short-term trend remains bearish although we should not ignore the daily and weekly break out that occurred and changed longer-term trend to bullish. So this downward pull back should be considered a buy opportunity for the longer-term.

Red line = price channel

Black line= resistance trend line

Blue line = support

The Dollar index remains below the Ichimoku cloud and below the black downward sloping resistance trend line. As I said in my last analysis, as long as the index remains below the trend line and the cloud, the trend is bearish and we should expect to see the index at the 38% retracement at 84.

Black line= resistance trend line

The Dollar index has seen the tenkan-sen and kijun-sen cross over and this was a bearish sign as I noticed yesterday. I expect the index to move towards the Ichimoku cloud and the 38% retracement. So trend remains bearish for the short-term. The chikou span is approaching strong support and we should soon know if the correction will continue towards 82.50 or it will stop at 84.