Dollar Index Approaching a Multiweek High

$USD appears to have finished (at 71.05 on 22 April 2008) the W.C of the ABC correction off the July 2001 high. In both time-frames, price subsequently completed W.4 of an impulsive rally off the W.C low and is likely to continue higher over the next day or two to conclude W.5 at 81.56-81.97 or 83.04-83.97.

Multiple-Timeframe Momentum: Bearish Trajectory Longer Term

The bearish weekly stochastic indicates that the longer-term trend remains bearish, with $USD likely to continue lower for at least the next week or two. Though bearish, the daily stochastic reflects weakening momentum that allows for limited upward price movement over the next few days, consistent with the multiple-timeframe bullish pattern and price position.

Implications: $USD May Be Headed Higher - At Least For the Next Few Days

Bullish pattern and price position across timeframes and consistent though mixed momentum indicate that prices are likely to move higher over the next few days.

Longer-term bearish momentum suggests that the upside is limited to 81.56-81.97 or 83.04-83.97 and will probably be followed by a retracement of at least 50-62%.

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