The Dollar index was trading inside the downward sloping channel. We labeled this decline as corrective. We also mentioned that prices were trading inside the support zone. We also mentioned that an upward move should soon be expected. This is what happened yesterday. Short-term trend has reversed upwards.

The downward sloping trend channel was broken upwards. Prices are moving upwards in an impulsive pattern and are now going to test the previous highs at 81.50. Breaking above that level will re-energise the bullish momentum with 82-83 as a target. The short-term support levels to watch are 81.05 and 80.50.

Prices in the daily chart have now reached the next resistance level at 81.30-81.50, where the previous highs and the 100-day MA are found. Breaking above the MA will be an initial bullish signal for the longer-term trend that has changed to upward after the low at 79. An important support level in the daily chart is the 80.45 level. Breaking that level will push prices towards 80.15 and probably to 79.50.