DXY after the consolidation is ready for a new bull move
The dollar after it was in a falling wedge and break out of it, found resistance at 50 days MA and the trend line which was formed in the summer of 2021. Now it is resting below that resistance and preparing for a massive bull move. The fact it didn't get rejected hard and continued to drop indicates a bull breakout will occur. If it breaks it would be a nice and textbook bull pullback, a nice and strong bullish pattern.
It is below 50 and 200 days MA which is bearish, however with the likely move up it will come in neutral territory. But day need to be closed above 50 days MA.
RSI after huge bullish positive divergences is now in the middle and is neutral.
MACD both MACD and the signal line are moving up and with a possible break out from this resistance, both lines will cross the zero line and will be very bullish.
Overall: with a likely break from those two major resistance lines, DXY would open a place to run strongly toward BigRed where it should find new resistance. In that case, this drop below the two-year-old trendline would represent only fake out, or as we call it dead hook, and would represent a very bullish pattern.
From the bearish side, a break below 20 days MA would represent a bear pullback with a target below 100. But that is now less likely.
It is below 50 and 200 days MA which is bearish, however with the likely move up it will come in neutral territory. But day need to be closed above 50 days MA.
RSI after huge bullish positive divergences is now in the middle and is neutral.
MACD both MACD and the signal line are moving up and with a possible break out from this resistance, both lines will cross the zero line and will be very bullish.
Overall: with a likely break from those two major resistance lines, DXY would open a place to run strongly toward BigRed where it should find new resistance. In that case, this drop below the two-year-old trendline would represent only fake out, or as we call it dead hook, and would represent a very bullish pattern.
From the bearish side, a break below 20 days MA would represent a bear pullback with a target below 100. But that is now less likely.
Consistency is the key of success....
