Dollar Index – Weekly Review

CANDLES :

Following last week’s large Bullish Engulfing, the U.S. Dollar continued its upward momentum, closing above the 8-week EMA for the first time since February—a significant technical development. On the 10-day chart, the index printed a strong Piercing Line, and the monthly candle is on track to become either a Piercing Line or a full Bullish Engulfing, depending on how the remaining sessions unfold.

The daily candles remain neutral to bullish, with the trend clearly pointing upward. Barring any unexpected disruptions, the Dollar appears poised to break above the 50-day moving average soon. In summary, the short- and mid-term outlook remains bullish, supported by strengthening technical signals across multiple timeframes.

ELLIOTT WAVES

There are no changes to the long-term targets for the Dollar. The extended wave 4 appears to be either complete or nearing completion. If the current momentum holds and the monthly candle confirms as a Bullish Engulfing, it would mark a significant turning point—potentially signaling the start of a sustained move higher aligned with the broader long-term bullish wave structure.

Road Map

The wave upward could be developing as an impulse, though the internal structure remains somewhat questionable. Given this uncertainty, the red count—which allows for the possibility of one more lower low—remains on the table as an alternative scenario.

SUMMARY

This week, the Dollar strengthened its bullish momentum and improved the outlook across larger timeframes. With next week and the upcoming monthly close shaping up to be pivotal, the market could be approaching a critical juncture.

From a broader perspective, the long-term trends on the quarterly and higher frames continue to favor the bulls. If there’s going to be a meaningful shift in that outlook, the next major signal is likely to emerge in September.

Happy Trading!