FX.co ★ Technical analysis of USDX for May 30, 2016

The Dollar index remains very strong in a bullish trend as price made a shallow retracement last week and was pushed to new highs towards 96. Price remains in a bullish channel but there are bearish divergence signals.

The dollar index made a shallow pullback last week on top of the bullish Kumo (cloud) and held support. Prices moved then higher to new short-term highs near 96. The oscillators provide some bearish divergence signals and that is why the US dollar bulls should be very cautious and protect their longs. Short-term support is found at 95.50 and next is at 95.20. A break below 95 will open the way to a bigger correction.

The weekly chart shows that price reached the kijun-sen (yellow line indicator) resistance. This is an important price level. A pullback is justified at the current levels. The trend remains bullish as long as price is above 92.