It's time to look at the Dollar Index chart again.
DX Daily Chart
Daily chart shows that DX is making a rising wedge formation. This is a bearish formation. A break under 80 means that USD will continue to slide.
DX Weekly Chart
Weekly chart shows a little bit confusion among the indicators. Anyhow, I believe that the fall is not complete until the RSI hit oversold. No bullish divergence in the chart.
DX Monthly Chart
Monthly chart is painting an ugly picture. USD rebound looks like over and DX looks like going to challenge 70 again and may go below 70 this time. However, if DX somehow manage to hold into this 80 level and towards 90s, then we can see a massive H&S formation that means that DX will go up to challenge the downtrend line at 105.
So, watch out how DX behaves because it may indicate whether the inflation play works out or not.
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