I have been supporting the camp that the Dollar index might have topped and a new decline has already started. My view can be found here. However despite the pull back in the Dollar index, there is no real progress in the major pairs to signal a trend change against the Dollar. Not yet at least.
We already have bearish divergence in the Dollar index (not shown in the chart above) but price remains inside the boundaries of a bullish trend. A new higher high towards 96-97 is not out of the question just yet. We will most probably have another divergence there, but this could also be the final pop to stop out most Dollar bears.
Mirror image of the Dollar index as EURUSD is its major component. Key resistance levels at 1.1760-1.1790. Break them and we are off to 1.19-1.20. However price remains inside the bearish trend boundaries and sits right below the key resistance area. A rejection here will open the way for the break of 1.15 that could lead to 1.12-1.13.
USDCAD USDJPY GPBUSD
All pairs remain inside their Dollar bullish boundaries sitting very close to crucial trend change levels. A major reversal in Dollar trend would most probably have broken through these important support and resistance levels and would not have paused the decline here.
So unless we see some more Dollar weakness soon, expect prices to move in favor of the Dollar for the rest of the summer.
Thank you for taking the time to catch up on my thinking.