As expected, the dollar index has moved to the downside and recently broke below the 96.24 lows that we have been highlighting for weeks. But structure now suggests we may be in the final stages of the higher degree downtrend from the 2025 highs. We could be dealing with a wave five, or possibly a wave C within an A-B-C decline (D2 count) that belongs to a more complex, higher degree correction. In either case, it’s important to keep in mind that a broader bottom could form in the coming weeks. For now, however, when looking at the intraday chart, there is still room for another leg down after wave four rally 97.44 resistance zone, which would be a key area to watch for a potential continuation lower and completion of the sequence somewhere near 95. However, if price overlaps above 98.26, that would invalidate the bearish impulsive interpretation and instead suggest that a major low is already in place.
Big Picture:
A higher degree correction from 2008 hits the channel resistance from where we can see a sharp reversal so there can be a run to the lower side of a channel in 2025.
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