USD Index & DAX Have Positive Correction, USD Index

The USD is making some strong moves across the board, as USD Index can be making a big wave three to the upside. The only surprise this morning was German DAX which was closed yesterday for holiday, so we have seen some nasty price moves. The index rallied to new highs before it lost nearly 250 points. However, we see the trend from the last two weeks as bullish so it may be worth to keep an eye on that gap from May 19th that can cause a new swing, ideally to the upside.

USD Index Elliott Wave Analysis

DAX gap

We also need to keep in mind that the USD Index and DAX are showing positive correlation because of strong negative correlation between EUR and DAX since ECB started with QE. But today, we see some divergence on the chart below, so the question is which one is correct. Well, we suspect that the EURUSD will continue south which can limit weakness on German DAX.

USD Index vs DAX

Gregor Horvat

Grega Horvat Grega is based in Slovenia and has been involved in markets since 2003. He is the owner of Ew-Forecast, but before that he was working for Capital Forex Group and TheLFB.com. His feature articles have been published on 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 Ew-forecast he helps clients and educates them about the Elliott wave principle 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. EW-Forecast To be involved in the market effectively, you need the right guidance and resources, and our team can help you to achieve that. Our team is providing advanced informations about Elliott Wave theory in real time. The Elliott Wave Principle gives you a method for identifying the behavior of the markets and at what points the market is most likely to turn. We help new traders who are interested in Elliott Wave theory to understand it correctly. We are doing our best to explain our views as simple as possible with educational goal, because knowledge itself is power!

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