FX.co ★ USDX technical analysis for January 20, 2016

The US dollar index shows signs of reversal but still above the important short-term support of 98.50. A breakout below this level will open the way towards 97. I am bearish as long as the price is below 100.50.

Red lines - bullish channel

Blue line - trend line support

The US dollar index has broken the medium-term support blue trend line and is now testing the 4-hour Ichimoku cloud and red upward sloping channel.

A closer look at the 4-hour chart shows how the price is testing the Ichimoku cloud support being just above the lower channel boundary. The levels of 98.50-98.40 act as critical short-term support.

Blue lines - bearish wedge pattern

The US dollar index is testing daily cloud support. If the day closes inside the Ichimoku cloud, it will be a bearish sign to me. A breakout below the wedge pattern will confirm my bearish view. Target will be seen at 97 at least.