Today’s downdraft breached a 95.68 support that I’d said in December was crucial to the bullish look of the dollar’s lesser charts. This warrants caution even though the longer-term charts remain bullish, albeit no longer unambiguously so. Assuming the current wave of selling takes out p2 support at 95.23, look for more slippage to at least 94.75, the pattern’s D target. We’ll reevaluate the trend if D gives way easily as well, but it looks likely to produce a tradeable bounce in any event. _______ UPDATE (Feb 7, 10:52 p.m. ET): Buyers recouped their mojo, pushing DXY to within a penny of Jan 24’s peak at 96.68. A move above it would generate a robust impulse leg on the hourly chart. _______ UPDATE (Feb 12, 7:53 p.m.): The dollar sold off hard after topping in the middle of the night. However, it did so after generating a very robust impulse leg on the hourly chart, implying the current weakness is merely corrective.
