Dollar Index eyes more downside as Iran deal boosts risk sentiment

Gregor Horvat Wavetraders

Good morning everyone. Risk-on sentiment is here as markets continue to improve ahead of the US-Iran peace deal that is expected to be signed on Friday. There were also some headlines suggesting that Iran has already signed the deal electronically.

As a result, we continue to see a very nice move lower in oil prices, with crude breaking below 80 dollars per barrel. At the same time, stocks are recovering and we may see even more upside if the dollar continues to weaken.

Now that the gap from Sunday has been filled, it looks like the Dollar Index could either be headed lower in wave C after a potential triangle in wave B, or there is even a chance that this is a W-X-Y correction from the highs still unfolding. In both cases, we see room for the Dollar Index to resume lower towards the 98.88 level.

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Author

Gregor Horvat

Wavetraders

Experience Grega is based in Slovenia and has been in the Forex market since 2003.

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