Dollar can stabilze ahead of key events [Video]
![Dollar can stabilze ahead of key events [Video]](https://editorial.fxsstatic.com/images/i/DXY-bearish-line_XtraLarge.png)
Stocks are a bit slow today, which could be due to the upcoming Non-Farm Payrolls report tomorrow. Also, with the 4th of July holiday in the US, we may see lower liquidity going into the end of the week as fewer traders remain active.
Overall, the risk-on sentiment remains intact. Trump mentioned he won’t extend the July 9th deadline for tariffs, suggesting some final trade talks could be taking place. If successful, this would be positive for the markets—at least for some. On the other hand, countries that don’t reach a deal with the US may face higher tariffs, which adds a layer of uncertainty.
In general, it looks like the US could come out of this in a strong position, possibly driving stocks even higher at some point. But lets keep in mind the usual inverse correlation with the US dollar. If we respect that correlation and observe the five-wave decline completed in subwave "c" of three on the Dollar Index, then a consolidation, three-wave recovery could show up soon—possibly a wave four rally off that red diagonal trendline support, as discussed in our previous updates.
So again, with NFP data, the July 9th tariff deadline, and the 4th of July holiday all in play, we may see some volatility and potential "intraday trend reversals" in the days ahead.
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Author
Gregor Horvat
Wavetraders
Experience Grega is based in Slovenia and has been in the Forex market since 2003.
