UUP Daily: (Bullish Dollar Index) Prompted by reading some articles about how Robert Prechter (Elliot Wave guru) is becoming bullish on the dollar (when everyone else seems to be bearish), below are a few charts.
Wave 3 came in exactly at the 1.272 fib projection of Wave 1. Wave 4 was exactly 0.786 of Wave 1 (which is also a 0.382 retracement of Wave 2). Sometimes when Wave 2 is "complicated and larger" it implies that Wave 4 will be "simple and smaller". This is exactly what we are seeing here. As we hit new lows for Wave 5, we saw divergence on the 3/10 Oscillator (red lines). This implies the down move may be ending.
Wave 5 was very close to the 1.272 fib projection of Wave 3. The AGET Osc (5,35) also showed divergence. as Wave 5 came in. Is is also very obvious that the Wave 5 movement has lost a lot of the momentum it had when putting in Wave 3 due to the angle and speed of the downward movement. This implies the bears are losing steam.
Based on the charts above, this would imply a rally from here. So far, we had a pop off lows and a 50% retracement, which is now nearing the near-term target. However, a further rise to 24.80+ may not be out of the question.
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