Dollar Index Support
In the start of today’s European session, traders saw some Usd short moves against the majors, driven by a higher German DAX. DAX has traded up to the 5810 resistance area before the market bounced powerfully lower to the 5700 support region.
Meanwhile the S&P futures traded down to the 1095 support level where a breakout could push the dollar even higher.
Overall, the U.S. dollar index still trades below the 76.19 top that was established on Monday, and as such, TheLFB Elliott Wave team will look for a move lower into the 75.00 – 75.20 support region before the U.S. dollar may trade long again.
Elliott Wave: The dollar index reversed on Monday after the 76.18 highs were hit. This was probably the top of a Long wave i, which means that the market is in a pull-back mode, in the form of a Short wave ii.
Wave ii is a corrective wave, and therefore traders should see at least three waves of a pull-back in the near-term. At the moment, we can only count a completed lower wave a), followed by a higher wave b) that is in progress. Before an up-trend can easily continue traders should look for another push into the 75.30 area following the wave c) leg, where a Short wave ii may find a base.
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Disclosure: No positions