A counter trend bounce for DXY first and then the fall.
In my previous update on DXY, I had expressed that wave 'z' had truncated on Nov 1. and that should mean the beginning of the fall for DXY.
Well from the truncated 'z' top the DXY has now fallen in a 5-wave pattern(Elliot wave theory).
While this in longer term suggests more downside for the dollar index(93$ according to me), in the short term one must remember that a five-wave fall/rise is always followed by a corrective move.
So, in this case the DXY should attempt to move a bit higher from current levels in what would be a counter trend move that could abruptly end close to the previous 4th wave high(104.557)(typical price behavior according to Elliot wave theory) or go up further till the 61.8% retracement(105.588) of the fall. Both these scenarios are labeled as Case 'A' and Case 'B' respectively on the chart.
Upon completing the either one of these scenarios wave iii to the downside will begin in DXY.
Note*- This chart is for educational purpose only. Please do your own research/analysis before taking up any financial positions.
Well from the truncated 'z' top the DXY has now fallen in a 5-wave pattern(Elliot wave theory).
While this in longer term suggests more downside for the dollar index(93$ according to me), in the short term one must remember that a five-wave fall/rise is always followed by a corrective move.
So, in this case the DXY should attempt to move a bit higher from current levels in what would be a counter trend move that could abruptly end close to the previous 4th wave high(104.557)(typical price behavior according to Elliot wave theory) or go up further till the 61.8% retracement(105.588) of the fall. Both these scenarios are labeled as Case 'A' and Case 'B' respectively on the chart.
Upon completing the either one of these scenarios wave iii to the downside will begin in DXY.
Note*- This chart is for educational purpose only. Please do your own research/analysis before taking up any financial positions.