Markets can turn at the beginning, middle, or end of a month most of the time. The USD had a bearish relapse this month but it looks like a corrective zigzag may have completed.
It also means that the USD can soar much higher. The US dollar is in a bull market which started in 2008, but this bull market is also producing a large number of overlapping waves. which work best as diagonal waves.
The USD may not breakout and even give us another leg down but in the bigger picture, this US Dollar is in a bull market even though commercials are heavy net short.
Last week commercial net short positions had a ratio of 40:1, which I consider extreme. Having a bullish wave count with those conditions in place is like two cars playing “Chicken” on the freeway! Last week the commercials added contracts to their long positions and took away 424 contracts from their short positions. This gives a clue that commercials had a bullish outlook last week!
It may be hard to realize but the USD has been in a major bull market since the 2008 bottom which I documented very well. The thing is the younger generation today has no clue how emotional that time period was.
Emotions of a herd only last for so long after which they disappear. It is the numbers and letters of the EWP that capture these emotions. You heard about the “Message in a Bottle”, well the EWP is all about “Emotions in a Bottle”.
Even with the trade war being in full swing, the USD keeps making bullish progress.
On the monthly charts, the golden cross has already happened, while on the weekly charts the moving averages are on the verge of creating another golden cross as well. The moving averages are giving bullish signals so we have to see who wins by the end of this month.
The full moon is coming up this weekend, so that can produce a turning next week as well.