While the U.S. Dollar Index (DXY) dropped to our target region for a wave 4 pullback this week, and began to rally, the pullback seen on Friday seems a bit deeper than what we should see for this b-wave of an (a) wave of 5. However, until we actually break below the low we struck this past week, I am going to maintain this count. Therefore, it means we should still see a rally towards the 97.20 region before we top out.
However, should we break below the low we struck this past week, then it can provide us with 5 waves to the downside, and could be the initial signal of the larger degree change of trend I am expecting in the coming months. However, I would need to see how the market rallies off the lower low to better make that determination.
So, for now, I will still look for a rally to the 97.20 region in the coming weeks. However, should we break below last week’s low early in the coming week, then I am going to have to see how we rally off that lower low to make any further determinations.