Forex Trading Technical Analysis (2011/02/08) Dollar Index Ready to Reverse? – Elliott Wave
(Please click on the forex chart thumbnail to enlarge)
2/08/2011 Forex Trading Technical Analysis (FXpath.com) – USD Index (daily chart) – The Dollar Index moved lower in 2010 and formed a three wave move, followed by a very sharp upward reversal in early November from the 75.54 region through the falling trend line, which is a strong indication that the US dollar might be headed higher in the first few months of this year. With this being said, a recent decline from the 81.45 region should only be a corrective retracement, labeled as a blue wave (2)/(B), which may have already found its base in this past week just below the 61.8% retracement area of wave (1)/ (A) , at 76.85.
In fact, on the intra-day structure you may also notice five waves up from the most recent support, which also suggests near-term strength for the US dollar.
A bullish bias remains in play as long as the market trades above 75.54 support. Any move below that region will invalidate the wave count.
If you would like more Elliott Wave forecasts for the forex market, please visit www.ew-forecast.com and check out a video tour of our products here.
Gregor Horvat
Elliott Wave Financial Service
EW-Forecast.com
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With current weak USD, America still have such a big trade deficit. No foundation to turn strong.