Dropped sharply on Thursday and resumed the Wednesday’s bearish candle as the USDX failed once again to close above the 93.81 static resistance. USDX stays also below a dynamic resistance, signaling a minor drop in the upcoming days. The index dropped despite the mixed US economic data and is located right above the 93.60 level.
I want to remind you that only a valid breakout above the 93.81 static resistance will confirm a further increase. Technically, the index was somehow expected to increase further as the behavior changed on the daily chart.
Unfortunately, the USD wasn’t impressed by the Unemployment Claims amazing drop, the indicator was reported at 232K in the previous week, much below the 240K estimate and versus the 244K in the previous reporting period, the Philly Fed Manufacturing Index dropped from 19.5 to 18.9, has come in better versus the 18.3 estimate. Moreover, the Capacity Utilization Rate and the CB Leading Index have come in line with expectations, only the Industrial Production has disappointed because has increased only by 0.2%, less versus the 0.3% estimate.
Price decreased sharply since Wednesday and invalidated, for now, a further increase. Could drop much deeper after another false breakout above the median line (ml) of the minor descending pitchfork. A further drop will be confirmed if will make a valid breakdown below the second warning line (WL2) of the former ascending pitchfork.
Only a rejection from the WL2 and a valid breakout above the median line (ml) will signal a potential Inverse Head and Shoulders pattern.
