Carry Trade – Weekly Overview

With the U.S. Dollar Index gaining traction and pressure building across key currencies, the carry trade is entering a potentially pivotal phase. In this week’s analysis, we assess the evolving dynamics across currency markets, examine the underlying signals, and outline the scenarios that could shape the next macro move. CANDLES Despite global turbulence, the carry trade remains technically constructive across all timeframes. In March, it further reinforced its long-term bullish stance while reducing the odds of short-term weakness. USD/JPY remains bullish across all frames, supported by a healthy trend and a solid technical backdrop. ELLIOTT WAVES The long-term targets for USD/JPY remain intact. While a larger wave 4 scenario is still possible, its probability has been diminishing following the February close and declined further after March. Summary The carry trade remains constructive across most timeframes, with recent bearish failures reinforcing the bullish outlook. Continued Dollar strength remains the primary path….