The US dollar is moving slightly higher and trading around its high of the week. However, we observe a wedge formation on the hourly timeframe ahead of the very important US PCE data release at 14:30 AM Central European Time. Simultaneously, we see US yields attempting to complete an a-b-c rise from June 14th. From an Elliott wave perspective thats a bearish formation, so if yields find new sellers following the US data later today, then the dollar index should also drop from resistance. Keep in mind that there's still a significant gap between the dollar and US yeilds, but I think that sooner or later these two markets will come back into a tight positive correlation.
If my assumption is correct and the dollar turns down from resistance, then I believe commodity currencies could perform very well. The Aussie and Kiwi are already moving into some very attractive support zones.
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