The U.S. Dollar Index is pressing into a decisive stage of its long-developing Elliott Wave structure, with price action now testing levels that could determine whether the broader trend resumes upward or unfolds into a deeper corrective phase.
The multi-year count shows the 2022 high likely completed a major Wave (v) of a larger impulsive cycle, after which the DXY has been tracing a complex corrective structure. The current form, an overlapping sequence of a-b-c subdivisions followed by a W-X-Y formation, suggests the dollar remains in the latter phases of a higher-degree correction rather than a fresh impulsive advance.
The key resistance band between 102 and 108 holds outsized importance in this context. A sustained break above this zone would invalidate the preferred bearish count, signaling that the correction terminated earlier than expected and that a new primary impulsive sequence upward may already be underway. Such a breakout would mark the first structural evidence of a renewed Wave (i)–(ii) base forming beneath the surface.
However, unless that confirmation arrives, the corrective interpretation remains dominant. The overlapping waves, declining momentum, and symmetry of the broader pattern point toward a final Wave (y) still incomplete. The projected termination region for this move, roughly the 91.50 to 86.20 zone aligns with Fibonacci 0.272 and 0.618 extensions, providing both proportional balance and historical confluence typical of higher-degree Wave Y endpoints.
Invalidation levels are clearly defined: a decisive move above the upper boundary of the multi-year channel and above 112.26 would conclusively negate the bearish corrective outlook and establish the beginning of a new impulsive cycle.
Until then, the Elliott Wave roadmap continues to favor a final downward sequence before the long-term structural reset is complete.
The multi-year count shows the 2022 high likely completed a major Wave (v) of a larger impulsive cycle, after which the DXY has been tracing a complex corrective structure. The current form, an overlapping sequence of a-b-c subdivisions followed by a W-X-Y formation, suggests the dollar remains in the latter phases of a higher-degree correction rather than a fresh impulsive advance.
The key resistance band between 102 and 108 holds outsized importance in this context. A sustained break above this zone would invalidate the preferred bearish count, signaling that the correction terminated earlier than expected and that a new primary impulsive sequence upward may already be underway. Such a breakout would mark the first structural evidence of a renewed Wave (i)–(ii) base forming beneath the surface.
However, unless that confirmation arrives, the corrective interpretation remains dominant. The overlapping waves, declining momentum, and symmetry of the broader pattern point toward a final Wave (y) still incomplete. The projected termination region for this move, roughly the 91.50 to 86.20 zone aligns with Fibonacci 0.272 and 0.618 extensions, providing both proportional balance and historical confluence typical of higher-degree Wave Y endpoints.
Invalidation levels are clearly defined: a decisive move above the upper boundary of the multi-year channel and above 112.26 would conclusively negate the bearish corrective outlook and establish the beginning of a new impulsive cycle.
Until then, the Elliott Wave roadmap continues to favor a final downward sequence before the long-term structural reset is complete.
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.