Dollar Consolidating at Resistance

The US Dollar Index has been consolidating just below resistance at 78 and the 200 EMA. It seems likely that in the shorter term it will be turned back here but I expect a higher low as the index proceeds to carve out a long term head and shoulders reversal pattern. A weekly close above the long term resistance zone will be a game changer.

It's also possible that the recent consolidation will end up being a bull flag. But the resistance at 78-80 is formidable and may take some work to penetrate.

The reaction to the jobs report on Friday may be telling.