The current chart of the DXY index shows the completion of the global corrective trend. This took the form of a triple zigzag consisting of cycle waves w-x-y-x-z.
Thus, the market is currently at the reversal stage, which is forming a new bearish trend.
The first impulse sub-wave of a potential standard zigzag Ⓐ-Ⓑ-Ⓒ is under construction. The end of the impulse Ⓐ is possible just below the minimum of 104.63, which is marked by a minute fourth correction.
Let’s look at another option in which the formation of a cycle triple zigzag is not yet fully completed.
Most likely, the bearish cycle wave x recently ended. This took the form of a standard zigzag Ⓐ-Ⓑ-Ⓒ of the primary degree. After that, an upward impulse price movement began in the initial part of wave z.
The wave z could take the form of a zigzag Ⓐ-Ⓑ-Ⓒ, where the first impulse and correction are already completed.
The entire z wave could complete its pattern near 114.41. At that level, it will be at the 50% Fibonacci extension of wave y.
Test your strategy on how the US dollar index will fare with Orbex – Open your account now.