Sorry for now being so active this week, but I have rather busy.
It has been sometims since I have talked about the USD. Today I have looked at EUR/USD as this cross leads over the USD-index currently. The reason of cause is the trouble in Southen Europe with Grees and Portugal, but Spain is doing everything it can to be center of the storm too.
It's clear that red circle wave 1 and 2 is in place and red circle wave 3 is ongoing. The break below 137.37 made it clear that the rise from 124.55 in early March 2009 was a three wave affair (overlapping wave 4 and 1, which is not allowed).
Looking at red circle wave 3 wave 1 ended at 138.63 and wave 2 topped at 140.28 and wave 1 of 3 most like enden yesterday at 135.86 excatly at the channel bottom. I now expect a small wave 2 of 3 rally towards the 137.43-137.53 area, before the next legg lower will be seen. Expect red circle wave 3 to reach at least 130.80 (1.618 times red circle wave 1). Stay with the dollar!
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