Dollar Index: Weekly Price Action & Technical Analysis as on 3-JUL-2016

In the passing week the Dollar index printed a low range consolidation bar, right at the mid Quarterly range.

The Monthly, Quarterly and Semiannual bars were finally printed by the end of Thursday.  The Monthly bar closed bullishly on the short term sentiment 8 EMA (Monthly), and above the 20 SMA (mid Bollinger Band) as well, but not so “convincing”. The Quarterly closed as a bullish pinbar over its 8 EMA, can turn into a very meaningful indication on a thrust up above its high. The Semiannual closed as a bearish inside bar, but still reveals a strong momentum up as it has penetrated the upper Bollinger Band considerably.

Dollar Index: Monthly, Quarterly and Semiannual charts (at the courtesy of prorealtime.com)

Dollar Index: Monthly, Quarterly and Semiannual charts (at the courtesy of prorealtime.com)

The most important bar indication for the next move is the Quarterly bullish pinbar leaning on the 8 EMA as well as on the Yearly LHBL line mentioned couple of times before (92.53, blue), and so far looks as a false thrust down of the Quarterly range. A thrust up above this bar, which is currently the Weekly High (96.865), is crucial because it means basically confirmation of a false break down of the Quarterly range. So, a thrust up (especially if followed by a small testing correction and a follow thru upwards, on a 4H timeframe and above) makes the Dollar Index very bullish, aiming to take out the last major High at 100.785.

On the other hand, signs of weakness around the current area without a thrust up above the Weekly High will probably lead to another wave down, very likely to the 87 level, mentioned on the previous review (Bearish wave 5).

 

Disclaimer: Anyone who takes action by this article does it at his own risk and understanding, and the writer won’t have any liability for any damages caused by this action.

Gil Ecker

[email protected]

Market Analyst and trader

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