Finally, we have clearly surpassed wave 5 bottom, which indicates that the correction we have been monitoring for the past days is finally over, which makes it official: we are in a new down wave! But the bounce from Friday’s low
85.93, which is closing on the important resistance 86.81 this morning, warns of a correction to what we have seen of the new wave so far (the drop from 88.10 to 85.93). Nevertheless, with a correction in these areas, or without, dropping far below 86 and may be below 84.81 itself has turned into a most probable scenario. The resistance which will determine if this bounce from Friday’s low will go on or stall, is 86.81. If broken, the Dollar will keep shooting higher, targeting 87.49 & then what we imagine as the “ceiling” for the price at this stage 88.10. But, if we break the exciting support 86.25 instead, we will start dropping to areas below Friday’s low, we find 85.60 & 84.81 to be the most attractive of which.

Support:

• 86.25: Jul 16th low, just 2 pip below Thursday’s low.

• 85.60: the falling trend line combining the daily lows of Jul 1st & 16th.

• 84.81: Nov 27th 2009 low, and the low of the last 15 years.

Resistance:

• 86.81: Jul 26th & 27th lows, and an obvious hourly support.

• 87.49: Jul 29th high.

• 88.10: Jul 28th top.