USD Index: Corrective Retracement Within Uptrend

By: Gregor Horvat | Wed, Dec 9, 2015
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USD index has turned down last week, into a new correction that should be made by three waves. We are tracking wave (4) that is part of an ongoing motive structure in big black wave V that could reach levels around 103-104 in months ahead. Invalidation level is at 93.83; as long this one holds trend is up.

USD Index, Daily

US Dollar Index daily Elliott Wave Chart

On the lower time frame, USD index fell sharply lower last week which has been technically expected after an ending diagonal in fifth wave of an impulsive move. Current leg down is very strong, so it belongs to a bigger downward structure. We will be tracking a zigzag so be aware of more weakness after wave B which could retrace back to 99.00 area.

USD Index, 4H

US Dollar 4-Hour daily Elliott Wave Chart

A zig-zag is a 3-wave structure labeled A-B-C, generally moving counter to the larger trend. It is one of the most common corrective Elliott patterns.

Basic Zig-zag:

Idealized Basic Elliott Wave Zig-Zag

 


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Gregor Horvat

Author: Gregor Horvat

Gregor Horvat
www.ew-forecast.com

Gregor Horvat

Grega is based in Slovenia and has been involved in markets since 2003. He is the owner of www.ew-forecast.com, but before that he was working for Capital Forex Group and TheLFB.com. His feature articles have been published on: SafeHaven.com, FXstreet.com, Thestreet.com, Action forex, Forex TV, Istockanalyst, ForexFactory, Fxtraders.eu, Insidefutures.com, etc. He recently won the award on FXStreet.com for Best Forex Analysis in 2016. At www.ew-forecast.com he helps clients and educate them about the Elliott wave prinicple and how to label and track unfolding patterns in real time.  His approach to the markets is mainly technical. He uses a lot of different methods when analyzing the markets such as candlestick patterns, MA, technical indicators etc. His specialty however is Elliott Wave Theory which could be very helpful especially if you know how to use it in combination with other tools/indicators.

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