Getting Closer...

This has been a very messy and comparatively weak second wave, but it appears to be doing its job in convincing some investors that the bull market is back after a scary corrective aberration.  The right shoulder is nearly formed now, and we're only about 60 pips away from my target.

EUR/USD Daily

I have bids on the Dollar Index sitting at 75.00.  We'll probably go below that, but not by much.

Dollar Index Hourly

There's obviously still one big worry about this projection, and that would be that equities don't look ready to top just yet even if the Euro has and is ready to make a big move down.  But we need to remember that while the relationship is a tight correlation, that still does not imply causation.

The last time we had an intermediate top in equities, the dollar had been rallying for about five months.  This is why I regularly characterize a falling dollar as putting a tailwind behind stocks.  It only promotes a better environment for all asset classes to rise.  I don't necessarily believe that a strong rally for the dollar means that equities must fall.