Previous analysis updated – in previous analysis produced on the 21st June 2018, I called the high of the rally at 95.22. This was wrong. It traded marginally higher, 3 pips in fact, putting in a high of 95.25 on the 28th June. It now appears as if it is all systems go for the mini crash of 2018. This should, in my opinion, be confirmed next week with follow through to the downside.

Daily Chart

Pattern – we can see price struggling to consecutive highs over the last month. The move down from the last high broke below the previous swing low, denoted by the horizontal line, thereby creating a lower low. Price now looks to have turned down, setting up a lower high, but will need follow through to the downside to confirm this. It is now decision time for price – it either explodes higher from here or tanks to the downside. Whatever move it makes should not be a struggle. I favour the tanking option.

Bollinger Bands – price traded just above the middle band where resistance looks to have kicked in as of today. Price should not get back up to the upper band now. If it does, this analysis is wrong.

Fibonacci – the first bear rally in a new bear trend often makes a deep retracement and that is certainly the case here with price turning back down just below the 88.6% retracement level.

Andrew’s Pitchfork – price broke down below the lower channel line before having one last shot and getting back inside the lower channel. Today’s price action looks like this was an abortive attempt, with price closing back below the lower channel line.

RSI – a triple bearish divergence often leads to a significant decline while this high was accompanied by a quadruple bearish divergence just for a good measure. This looks to be a very bearish development.

Summing up – the expectation of a mini crash in the US dollar during the second half of 2018, which sees price get down to around previously defined 80 level, remains unchanged and I believe this crash move is now in its very infancy.

By Austin Galt

www.thevoodooanalyst.com

Austin Galt has previously worked as a stockbroker and investment banker while studying technical analysis for over two decades. He is also the author of the book White Night: A Colombian Odyssey

Email - info@thevoodooanalyst.com

My website is www.thevoodooanalyst.com

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

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