The 1H timeframe of the DXY index suggests the completion of a global corrective trend, which has taken the form of a triple zigzag consisting of five cycle waves w-x-y-x-z.
Thus, the market is currently at the stage of reversal, that is, the formation of the initial part of a new bearish trend may soon begin.
It is assumed that the bears are starting to build the first impulse sub-wave of the potential standard zigzag â¶-â·-â¸. The end of the impulse â¶ is possible just below the minimum of 104.63, which is marked by a minute fourth correction.
An approximate scheme of possible future movement is shown on the chart.
In an alternative scenario, the formation of a cycle triple zigzag is not yet fully completed.
Most likely, at the level of 104.69, the bearish cycle wave x was completed, which took the form of a standard zigzag â¶-â·-â¸ of the primary degree. Then the market turned around, and an upward impulse price movement began in the initial part of the wave z.
The wave z can take the form of a zigzag â¶-â·-â¸, and now a sub-wave â¶ is being formed.
The entire wave z may complete its pattern near 116.80. At that level, it will be at the 61.8% Fibonacci extension of wave y.