The Dollar index made a pullback yesterday after being rejected at the daily cloud resistance of 93.70 as we expected. Short-term trend remains bullish and the current downward move is still considered a pullback. However I believe that this downward move will soon accelerate.
Red lines — bullish channel
The Dollar index has broken down and out of the bullish channel. This at least will bring a corrective pullback towards the 38% Fibonacci retracement. The 38% Fibonacci retracement at 92.95 is the first important short-term support. Next support is at 92.50 (61.8% Fibonacci retracement).
The rejection at the daily Kumo (cloud) implies that we should expect a test of the tenkan- and kijun-sen support levels between 92.60 and 92.30. A daily close below these two indicators will be a bearish sign. If price falls below 92.30 we will have confirmation of a new downward leg towards 90.