FX.co ★ Descending triangle pattern in the Dollar index

The Dollar index has so far respected support area at 97.50-97.70. However price remains below the downward sloping trend line resistance forming a bearish descending triangle pattern. It is best to stay neutral if price in the middle of the triangle or take opposing positions relative to the price's position. If price near resistance I prefer to be short with a tight stop in case we see a break out. If price is at support I prefer to be bullish in case price bounces off support. However in descending triangles it is most probable to see price break support. So be cautious.

Black line resistance trend line

As you can see in the chart above price has so far touched the black downward sloping trend line resistance two times after the peak in early September and got rejected. Support has been reached also several times but bulls managed to hold above it. Traders need to be patient and see if price continues to trade inside this tightening range.