The US dollar index ($DXY) extended its major (long-term) uptrend during June, hitting a high of 101.80, up 2.29 (2.3%) for the month. This was an initial test of the 50% retracement level of the previous major downtrend at 101.99. Recall the greenback posted a new 4-month high during March 2026, possibly triggering buy stops, confirming the uptrend signaled by a monthly stochastics completing a bullish crossover below the oversold level of 20% at the end of February. Theoretical Positions: Investors would’ve gone long near the March close of 99.96.
The Euro (^EURUSD) extended its major downtrend to a low of 1.13246 during June before closing at 1.14215, down 2.0% for the month. The euro first posted a new 4-month low during March, then again during June as it took out the March mark of 1.14111. The 50% retracement level of the previous major uptrend is down at 1.11291. Theoretical Positions: Investors are either short the euro near 1.14689 (March 2026) or near 1.14110 (June 2026). If short at both levels, the average position would be roughly 1.144.
The Euro/Canadian dollar (^EURCAD) remains in a major downtrend, despite closing higher at the end of June. This was the second consecutive higher monthly close. Based on Elliott Wave analysis, the ^EURCAD could test its previous high of 1.64678 as a Wave B (second wave) rally within the 3-wave downtrend pattern. Theoretical Positions: Short positions could’ve been established near the October 2025 settlement of 1.61659 with additional positions below the December low of 1.60618. This puts the average short position at roughly 1.61135. The June close was at 1.62154.
The Canadian dollar (^CADUSD) moved to a major downtrend during June as it took out the previous 4-month low of 0.71604 during June. The loonie extended its selloff to a low of 0.70186 before closing at 0.70437, down 2.8% for the month. Theoretical Positions: Investors would’ve liquidated long positions from the close of February 2025 (0.69125), adding positions along the way as the loonie took out previous high marks, including January above the previous peak of 0.73854 from June 2025, below the previous 4-month low of 0.71604. New short positions would’ve been established at the same price.
The Brazilian real (^BRLUSD) extended its major downtrend during June, falling to a low of 0.19089 before closing at 0.19315, down 2.4% for the month. Recall the real moved into a major downtrend at the end of May as it completed a bearish spike reversal, coinciding with a bearish crossover by monthly stochastics above the overbought level 0f 80%. This means the real both signaled (stochastics) and confirmed (reversal pattern) the new downtrend. Theoretical Positions: Investors long near the January 2025 settlement of 0.17188, based on a bullish 2-month reversal, would’ve liquidated those positions near the May settlement of 0.19785 locking in a gain of approximately 0.02597. New short positions were established at the same May settlement price.
