15 Jan 2021 ● 07:15 AM
Some people asked me about life above 91 for the dollar index. Good question and this is what it may be. There is a positive divergence on weekly charts both on momentum and RSI. This can push prices higher toward 92.1 at the 20 week average or even to 93 closer to the 40 week average.
When the decline in the dollar index started in May I marked the initial declines as 1-2-1-2 but later after the bounce in Sept, we broke out of the falling channel. Since then I have been considering wave 1 complete at the Sept low. But if I go back to the earlier wave count it is possible to mark the entire decline to the recent low as 5 waves that permits a larger bounce. So this alternate wave count might not be wrong but its choice depends on the size of a bounce. If 91 is not crossed then my current count of wave 2 of 3 up and next 3 of 3 down remains intact. Above 91 the below count will kick in. I may also keep both the alternate wave counts open till a later date just in case.