SINGAPORE: The dollar index is expected to rise into a range of 120.33-121.02 in the fourth quarter, as suggested by its wave pattern and a projection analysis.
The current rise is driven by a wave C, which has travelled above its 76.4% projection level. Chances are this wave could extend to 120.33, close to the 2001 high of 121.02. These levels are considered as strong resistances.
Either one of them could be solid enough to stop the rise and trigger a decent correction.
When working together, they become more powerful.
It will be extremely difficult for the index to break these resistances and shoot up higher in its first attempt.
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On the daily chart, the uptrend remains firm. It consists of many impulsive waves that are roughly divided into four degrees.
The wave (5) of the lowest fourth degree is still unfolding. With the trend continuously slopping up, a decent correction is unlikely to occur until the index fulfils its quarterly target of 120.33.
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