For the last two months the US dollar is on a slide that sure looks like a pretty impulse wave structure at this time. Once 5 waves are completed, then a 3 wave counter rally specific to the degree I’m working on, is supposed to happen. The idea that we could be in another triangle in a 4th wave position doesn’t fit the way I like it too, so we could still see a counter rally much bigger that what I have right now.
The top trend line is only there to show a future counter rally resistance rally, as any counter rally can come back to the previous 4th wave of one lesser degree. This would give us a 96.200 retracement price level. At this point I’m working from a wave 2 base which I may change to a 4th wave base, at some point in the future.
I would have to use the daily chart and take another look, so short term this is a bit fuzzy. When parts of the intraday charts are fuzzy, then I switch to daily and weekly charts to get another perspective. This small rally can still surprise us if it’s not finished yet. The US dollar will not switch back to its big bullish phase until the majority of the expert talking heads, are on board the bear wagon, and have developed a consensus opinion. That situation is still a long way away at this time.
At the extremes the markets will always do the opposite of what fundamentals suggest. Just like analysts paint us a rosy picture at the top, the opposite happens at major bottoms, when they paint us a very bleak, or pessimistic picture. The more pessimistic, the bigger the counter rally is my basic guideline.