FX.co ★ #USDX analysis for October 29, 2013

Yesterday, we noted how increased was the probability to see an upward bounce in the Dollar index. Short-term resistance was broken and prices are starting to make an upward bounce towards the next resistance level at 79.85-95.

Short-term resistance is found at 79.70 and then at 79.85. Short-term support is found at 79.30 and 79.15. The upward move is overlapping and thus corrective. Despite the corrective nature of the rise, this upward move could continue towards 80. We are bearish overall and will sell the upward corrective move near 80.

The longer-term trend remains downward and any upward move is labeled corrective as long as prices trade below the two downward sloping trend lines that touch previous highs. We could see a test of the first downward sloping trend line near 80-80.20. The longer-term trend will change only if prices break above 80.70.