Elliott Wave Analysis: USD Index Impulsively Continuing Higher
USD index was in big sideways pattern unfolding since start of 2015; slow and overlapping price action with a personality of a contra-trend movement that looks completed based on five waves up from 91.90 level that can be a leading diagonal in wave 1-circled. If that’s the case, then recent pullback was sub-wave 2) that appears completed at 95.84, near lower support line of an upward channel. As such, trend remains in bullish mode now for wave three that has first target near 101.00, but ideally dollar will move much higher in weeks ahead.
USD Index, Daily
Regarding the lower time frame, USD index fell sharply on US elections day last week, but market quickly realized that Trumps victory may not be so bad for the US and dollar itself since he supports idea of higher interest rates. As such, market turned up as US elections results were coming out. We have seen a nice bounce from 95.90, where rising trendline and 61.8% Fib. retracement turned out to be a very good support. We have seen a nice and strong recovery at the end of the week, clearly in impulsive fashion which we believe belongs to a much bigger trend. In the short-term however, we can see a corrective set-back with small three waves before market goes even higher, above the 100 mark.
USD Index, 4H