US Dollar Outlook: Wave Count Signals Possible Pullback After Strong Weekly Rally

Good morning everyone and welcome to our fresh update for Friday, the final day of the week. 

As you know, it's been a pretty volatile week, but what is important for the end of this week is that markets could go a bit sideways. The dollar has also extended quite nicely to the upside, so it certainly could be time for some pause, also because it's a US holiday, meaning that parts of the market will be closed. This means lower liquidity and could result in slower trading sessions ahead, making it a perfect time for the market to see some retracement. 

When looking at the dollar, it would not be a surprise to see some setback because after all we can count five waves up from the 99.10 level, and this could allow for some pullback in the near term. Pullbacks should then be structured by three waves, so an A-B-C decline is something that we should be aware of over the next few sessions. It could be just another fourth wave before a fresh rebound, but for now it may be better to wait on the sidelines and see what happens early next week, with support around 100.00.

GH