A lot of traders will look at this chart and immediately say the long-term downside target is too extreme.
But structure does not care what looks comfortable.
On the monthly
DXY chart, the larger bearish ABC sequence is still alive. The rule is simple: as long as B is not breached, C remains a valid price target.
That does not mean price must collapse in a straight line.
That does not mean every bounce should be shorted blindly.
It simply means the market has not invalidated the bearish draw yet.
The updated chart gives us an important short-term roadmap.
DXY pushed into the smaller bullish ABC target area, but that move also created what looks like trendline manipulation around the long-term descending trendline. Price traded above the obvious trendline area, attracted breakout buyers, then started rejecting back below it.
That is not clean bullish acceptance.
That is a warning.
Now we have a smaller bearish ABC sequence forming from that rejection. Its C target points directly into the WCL zone below.
That matters because WCL is not random support. WCL is the buyer’s last serious defense area inside the current bullish reaction. If dollar bulls are still optimistic, that is where they should reload and defend.
So the real decision is not happening at the current price.
The real decision is likely at WCL.
If price reaches WCL and buyers defend it, DXY can still attempt another reaction higher. But if WCL fails, then the larger bearish structure becomes much more dangerous because the market would be confirming weakness after trendline manipulation.
My read is simple:
The long-term bearish C target remains valid until B is breached.
The short-term bearish ABC target points into WCL.
WCL is the next key reaction zone.
A failure from WCL keeps the larger downside draw alive.
A clean breach of B is the only structural invalidation of the bearish C target.
This is not about predicting a dollar crash.
It is about respecting structure until the market proves it wrong.
Bias: Long-term C target remains valid while B holds.
Short-term focus: smaller bearish C into WCL.
Bullish defense zone: WCL.
Invalidation: B breach.
Main risk: trendline manipulation turns into full bearish continuation.
Not financial advice.
But structure does not care what looks comfortable.
On the monthly
DXY chart, the larger bearish ABC sequence is still alive. The rule is simple: as long as B is not breached, C remains a valid price target.That does not mean price must collapse in a straight line.
That does not mean every bounce should be shorted blindly.
It simply means the market has not invalidated the bearish draw yet.
The updated chart gives us an important short-term roadmap.
DXY pushed into the smaller bullish ABC target area, but that move also created what looks like trendline manipulation around the long-term descending trendline. Price traded above the obvious trendline area, attracted breakout buyers, then started rejecting back below it.
That is not clean bullish acceptance.
That is a warning.
Now we have a smaller bearish ABC sequence forming from that rejection. Its C target points directly into the WCL zone below.
That matters because WCL is not random support. WCL is the buyer’s last serious defense area inside the current bullish reaction. If dollar bulls are still optimistic, that is where they should reload and defend.
So the real decision is not happening at the current price.
The real decision is likely at WCL.
If price reaches WCL and buyers defend it, DXY can still attempt another reaction higher. But if WCL fails, then the larger bearish structure becomes much more dangerous because the market would be confirming weakness after trendline manipulation.
My read is simple:
The long-term bearish C target remains valid until B is breached.
The short-term bearish ABC target points into WCL.
WCL is the next key reaction zone.
A failure from WCL keeps the larger downside draw alive.
A clean breach of B is the only structural invalidation of the bearish C target.
This is not about predicting a dollar crash.
It is about respecting structure until the market proves it wrong.
Bias: Long-term C target remains valid while B holds.
Short-term focus: smaller bearish C into WCL.
Bullish defense zone: WCL.
Invalidation: B breach.
Main risk: trendline manipulation turns into full bearish continuation.
Not financial advice.
Note
Trendline typo.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.