Search ForexCrunch

On Friday we mentioned to our members that a downside risk on the USD Index is limited. Thiswhich has proved correct as prices are already recovering from latest low.

In fact, the recovery is not a surprise after five waves of decline, bullish RSI divergence plus an ending diagonal placed in wave (v). These are all important pieces that put the USD index in a recovery mode, for a minimum three wave rally. Why a minimum three waves?

Because that’s the structure of a contra-trend movement. This three wave rally, labeled as an (a)-(b)-(c) can reach 80.73 figure which was wave four swing high.

US dollar index October 8 2013 technical elliott wave analysis for forex traders