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by Koos van der Merwe
On February 15, I argued that the US dollar has further to fall. Here is another chart and another argument that suggests just how low.
Position: Sell
Koos van der Merwe
Has been a technical analyst since 1969, and has worked as a futures and options trader with First Financial Futures in Johannesburg, South Africa.
PRINT THIS ARTICLE
ELLIOTT WAVE
Another Negative For The US Dollar
03/07/05 07:52:37 AMby Koos van der Merwe
On February 15, I argued that the US dollar has further to fall. Here is another chart and another argument that suggests just how low.
Position: Sell
| Figure 1 is a simple Elliott wave chart of the US Dollar Index (UDX). What is disturbing is that the count is almost classic and suggests that Wave 5 will be in the 71.14 area, a further fall of 17.06% (85.78-71.14 = 14.64/85.78 = 0.1706 * 100 = 17.06%). This ties in with my article "Forecasting The US Dollar" of February 15, where I used the movement of the Canadian dollar to predict a further 16%-odd fall in the US dollar. |
| The chart is very roughly suggesting a low for the US dollar sometime in June/July or August, with a rise into an ABC correction taking it to the 90.19 level. This will be true should the US dollar fall to the 71.14 level as suggested in the chart, a level chosen because of the support line I,III,V. |
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| Figure 1: A weekly chart of the US Dollar Index. The chart is roughly suggesting a low for the US dollar sometime in June/July or August, with a rise into an ABC correction taking it to the 90.19 level. |
| Graphic provided by: AdvancedGET. |
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| Of course, the US dollar could surprise us all and bottom out before this level, but the fact that I used a completely different technique to forecast a further 16% fall in the US dollar makes this one acceptable. |
| What happens after the high at "C" when the ABC correction occurs? By all accounts there should be another 5 wave down, but this impulse wave could hopefully be a flat, forming a double bottom at 71.14. Anything else will be too painful to consider. |
Has been a technical analyst since 1969, and has worked as a futures and options trader with First Financial Futures in Johannesburg, South Africa.
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| E-mail address: | petroosp@gmail.com |
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