USD is in the middle of a pullback

Gregor Horvat Wavetraders

USD is slowing down after we spotted 5th wave on May 31 (CLICK HERE). We warned about a pullback, as yields turned down from resistance which are in positive correlation with DXY chart.

The main reason for the DXY slow down is 10Y US Yields chart, which is turning down from resistance in minimum three waves. While one more leg down is still missing, we believe that DXY can be trading in the middle of a higher degree A-B-C correction.

USD is currently recovering sharply after a drop into first leg A, so we are tracking a three-wave a-b-c recovery within wave B that can retest the highs as part of a flat correction before wave C shows up.

What we want to say is that USD – DXY is trading in a correction within uptrend, but correction may take more time and can retest 103 – 102 support area before we will see more upside towards 105 - 106 area.

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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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