ABOUT THE AUTHOR: Avi Gilburt is a widely followed Elliott Wave technical analyst and author of ElliottWaveTrader, a live Trading Room featuring his intraday market analysis (including emini S&P 500, metals, oil, USD & VXX), interactive member-analyst forum, and detailed library of Elliott Wave education.
The DXY has now approached the target region of 96-97 this past week, with a high struck at 95.48. However, not only have we come up shy of our ideal target, but the pattern in wave Vof (3) does not yet look complete. In fact, it looks like we are completing a 4th wave in wave v of (3).
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As such, as long as the market remains over the 93 level, I am expecting a 5th wave in wave v of (3) to strike at least the 96 level, with the potential to extend as high as the 97 level.
However, once this wave (3) is complete, the wave (4) correction should take the market back to the 90-92 region. And, based upon the size of this move higher, I would expect this consolidation would take us several weeks to several months. It is important to remember though, that once wave (4) completes, the market is likely setting up for a wave (5) of 3 taking it over the 100 region later this year.
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