Looking at the bigger picture of both the DXY and the FXCM US Dollar index ($US Dollar) we notice that they have both been in consolidation patterns since the top in the spring of this year. The consolidation patterns in the two pairs, however, differ significantly from this top. In the DXY what we see is a wxy pattern in which the August 24th low made a new low under the May 13th low. The FXCM USDOLLAR Index did not. This could suggest that the FXCM USDOLLAR index will still see further downside action before a larger degree bottom is in place.  

Keep in mind that the FXCM USDOLLAR is an equally weighted index of the EUR/USD, GBP/USD, USD/JPY and AUD/USD, and is not to be confused with the DXY index, which is heavily weighted in European currency pairs with the EUR/USD representing 57% of the index as a whole. This is not to say that one index is better than the other, just that they are two indexes that are measuring different currency pairs against the US Dollar in an attempt to judge the strength of the US Dollar as a whole.  

My base case on the FXCM USDOLLAR is that the consolidation that we have seen since the May 2015 bottom was a larger b wave that took the shape of a triangle. The top of this wave (E) of this triangle would have come in at the 12,104.50 level. Initial confirmation that the triangle is, in fact, breaking down would come with a break of the 11,865 level. This puts initial targets for wave c of (iv) at the 11,589 level, which is the 100 extension of the wave a that ended in May of 2015.

The next major support level below the 100 extension comes in at the 11,323. After we bottom in the wave (iv) we would then expect another rally that exceeds the March 2015 high with ideal targets for the top of wave (v) of ((iii)) in the 12,415 -12,899 range. Alternatively, a break of the 11,009 level would be an invalidation of the larger impulsive structure to the upside and suggest that we have a larger degree top in place on this FXCM USDOLLAR Index.