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Good morning, everyone, and welcome to the final day of this trading week. Markets have seen some pretty nice movement so far—interestingly, the dollar has rallied after Powell didn’t deliver any kind of aggressive dovish tone. As a result, we’ve seen US yields stabilize a bit, which helped the dollar reach higher resistance levels we discussed in previous updates.

DXY Daily Chart

At the same time, stocks are still looking fine but are not really progressing much—trading sideways, similar to metals. Looking at the Dollar Index on the 2-hour timeframe, we see price coming out of a triangle, which suggests wave C is in play—meaning it’s the final leg of this corrective advance. So we still believe dollar bears will resume, and ideally, we are very close to a reversal point.

DXY 2H Chart

Next week, I think we could start seeing a new move to the downside on the dollar. A drop below 99.20 will confirm the end of the wave four rally.

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