US Dollar Index
It appears to me that the US Dollar has not only reached solid technical support but has established a sub-set 5 wave rally off the recent extreme. It must be stated that the decline stemming from the highs seen at roughly 103.70 also shows signs of impulsiveness making me believe any rebound will ultimately be confronted with resumed selling pressure. That being said I currently contend that a potential (a) wave of an a-b-c advance has been established. That would put us at this point in the midst of forming what looks like a (b) wave triangle of the sequence (a-b-c). This particular pattern allows one to establish a favorable risk to reward setup seeing that the risk can be so well defined. The minor pullback from yesterday’s high of 90.165 looks to be forming the (e) wave subset of the a-b-c-d-e triangle of the pattern. A slip that manages to hold above 89.50 in my opinion should ultimately thrust above the inner b wave extreme at 90.365. A fortification of 90.5 0 should trigger a continued follow through to the first upside target at +/-92. I’d expect a first time rejection off the area. Should the pattern stay intact I’d be looking for further gains to reach for +/-94.50.
My analytical breakdown focuses on a blend of wave pattern recognition, long and short term geometrical extensions and momentum signal interpretation. Please feel free to contact me at Walsh Trading to discuss my insights into this or any market of your interest.
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