Elliott Wave Analysis on the USD
by Dan Stinson
February 03/05
Short Term Forecast - The USD has been rallying in wave (2) after it bottomed in December 2004. We should see 3 waves up to complete this wave (2) rally before further downside to new lows. The USD has completed wave A and is completing wave B as a triangle, which is complete, or almost complete. We need to see a break above 84.08 to confirm the completion of the triangle and the start of wave C up.( At the time of the writing, it just broke above 84.08). We should see wave C complete as 5 waves up. Once wave C of wave (2) completes, we should see the USD move to new lows. At the same time we should see the metals bottom and move to new highs. Gold and Silver still have further downside in wave C to complete wave (2) down, before further upside. The first chart for the USD indicates that the wave B triangle is complete and further upside in wave C is to follow. The second chart for Silver illustrates further downside to the $5.50 area in wave C is expected before a reversal.
While we have traced the wave (2) upside count for the USD, we also have
traced out the downside counts for Gold and Silver. Further downside for
Gold and Silver is still expected and we could see Silver as low as $5.50.
Conversely, the USD appears ready to move higher in wave C to at least
the 85-87 area. Once these C waves complete, there will be some excellent
opportunities for Gold and Silver and many stocks that have dropped significantly
since the beginning of last year.
We can use these charts to monitor and confirm the upcoming reversals.
The move higher for the USD in wave C will be impulsive and will move
quickly once it gets underway. At the same time, we should see steep downside
for the metals to complete the downside to the target areas. If you are
interested in viewing these updated charts and other detailed charts with
targets for the reversal on a daily basis, please see the registration
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Happy Trading!!!
Dan Stinson
Elliott Wave Chart Site
e-wavecharts.com