Big Time Backtest Looms

Over the past few days the dollar has broken down below the 6-month old rising trendline (A). If the dollar holds below trendline A then this will is a huge turn of events and a big time game changer in the bulls favor. Now the dollar has briefly broken down below trendline A before in April, but it promptly rallied back above trendline A. Furthermore the dollar is at support at 84.8 and given how fast the dollar has dropped I am expecting a bounce here.

So if DX bounces then the biggest thing to watch for is whether DX can break back above trendline A on a backtest. If it can't, then this is the ultimate kiss of death for the dollar and is a big statement from the world that the bull market lives. However if the dollar breaks back above trendline A then I will believe that any S&P rally will be short lived.