Hello fellow traders. In this technical blog we’re going to take a quick look at the Elliott Wave charts of Dollar Index ( $DXY ). As our members know, Dollar is correcting the cycle from the 114.67 peak. Recovery is unfolding as Wave Zig Zag Pattern. In the further text we are going to explain the Elliott Wave Pattern and the Forecast.
Before we take a look at the real market example, let’s explain Elliott Wave Zigzag pattern.
Elliott Wave Zigzag is the most popular corrective pattern in Elliott Wave theory . It’s made of 3 swings which have 5-3-5 inner structure. Inner swings are labeled as A,B,C where A =5 waves, B=3 waves and C=5 waves. That means A and C can be either impulsive waves or diagonals. (Leading Diagonal in case of wave A or Ending in case of wave C) . Waves A and C must meet all conditions of being 5 wave structure, such as: having RSI divergency between wave subdivisions, ideal Fibonacci extensions and ideal retracements.
Dollar H4 Elliott Wave Analysis 02.14.2022
Dollar is doing recovery against the 114.67 peak. Current view suggests cycle from the 100.83 is in progress as potential Elliott Wave Zig Zag Pattern. We can count 5 waves up in A red wave and 3 waves down in B red. Consequently we expect to see another 5 waves up in C of (B). At this stage we assume B red is completed at 102.6 low. We would like to see break of 02/07 peak ( A red) to confirm C red wave is in progress.
You can learn more about Zig Zag Elliott Wave Patterns at our Free Elliott Wave Educational Web Page.
Dollar H4 Elliott Wave Analysis 02.16.2022
Eventually Dollar has broken above 02/07 peak, confirming next leg up is in progress. Dollar is showing now incomplete higher-high sequences in the cycle from the 100.81 low, calling for further strength. As far as pivot at 102.6 low holds, Dollar can see extension toward 105.73+ area.
Keep in mind market is dynamic and presented view could have changed in the mean time. You can check most recent charts in the membership area of the site. Best instruments to trade are those having incomplete bullish or bearish swings sequences.We put them in Sequence Report and best among them are shown in the Live Trading Room.