FX.co ★ The Dollar index makes new highs but the RSI is warning bulls.

Blue line- bearish RSI divergence

Technically trend remains bullish for the Dollar index as price continues making higher highs and higher lows. However as we mentioned in previous posts, the weekly trend is in danger as the bullish momentum is weakening. Today the Dollar index made new intraday highs of 2022 but bulls seem unable to retain them. The Daily candlestick with the long upper shadow (tail) is a bearish sign. Despite making new highs, it shows that bulls are unable to hold prices as heavy selling is pushing price lower. The bearish RSI divergence confirms the weakening of the bulls. However we should also keep in mind that the RSI bearish divergence is only a warning and not a reversal signal. As long as price is above 104.60, bulls will remain in control of the Daily trend. Short-term trend can turn bearish very fast specially if price breaks below 107.50.