Although my most favoured count, that had us in wave [iv] of minor 3 has not been invalidated, the action in the dollar over the last couple of days suggests it is more likely that my next favoured count is probably correct. That has intermediate wave [1] complete as at the high on 7 June, so the decline from there is intermediate wave [2].
I said on 9 July that if we took out the low of what was assumed to be an ending diagonal at that time, then it was likely that something other than the end of the correction from 7 June was occurring. I think my previously second favourite count is that something else.
Here's the daily chart updated from the weekend:
The target for wave [2] is most likely somewhere in the 50-61.8% retracement level shown highlighted in yellow on the chart. However, we are now into an area of prior price congestion with today's decline (highlighted in blue) so its possible that wave [2] could end not too far away from current levels.
Looking at the 90 min chart, however, the wave count doesn't look complete and looking at where we possibly are in that count, we could well reach that yellow highlighted area by the time we are done:
Dollar 90 min chart:
That horizontal black line on the chart marks the low of what was thought to be an ending diagonal completing on 9 July. It did provide a good long opportunity before it was invalidated as being an end to the correction, which goes to show that you can be wrong on the wave count, yet still make money.
Once price broke the low in question, 83,622, on the push down to 83.383, it was likely to be a good short opportunity, either within the subsequent consolidation between the black and red lines, or, on the break and re-test of the red line.
So, it looks like there should be more downside to come. However, a move now above the low marked (i) at 83.383 would mean that something is amiss with the count and that the correction may well have ended. If we break above the [b] wave high, then it will be almost certain that its ended. This all assumes, of course, that the labels are correctly placed.
