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Category Archives: US Dollar

US Dollar Intraday Bear Market Update

For the last two months the US dollar is on a slide that sure looks like a pretty impulse wave structure at this time. Once 5 waves are completed, then a 3 wave counter rally specific to the degree I’m working on, is supposed to happen. The idea that we could be in another triangle in a 4th wave position doesn’t fit the way I like it too, so we could still see a counter rally much bigger that what I have right now.

The top trend line is only there to show a future counter rally resistance rally, as any counter rally can come back to the previous 4th wave of one lesser degree. This would give us a 96.200 retracement price level. At this point I’m working from a wave 2 base which I may change to a 4th wave base, at some point in the future.

I would have to use the daily chart and take another look, so short term this is a bit fuzzy. When parts of the intraday charts are fuzzy, then I switch to daily and weekly charts to get another perspective. This small rally can still surprise us if it’s not finished yet. The US dollar will not switch back to its big bullish phase until the majority of the expert talking heads, are on board the bear wagon, and have developed a consensus opinion.  That situation is still a long way away at this time.

At the extremes the markets will always do the opposite of what fundamentals suggest. Just like analysts paint us a rosy picture at the top, the opposite happens at major bottoms, when they paint us a very bleak, or pessimistic picture. The more pessimistic, the bigger the counter rally is my basic  guideline.

US Dollar Intraday Crash Update

The US dollar keeps on crashing, and it should continue for the foreseeable future.  Surprise rallies will be part of the landscape, but when we are in a big bear market then any rally will only be a temporary thing.  Gold has responded to the USD crash like it has done many times before and has broken well below the 91 price level, that I have talked about in my updates.

I have another couple of downside targets that I would like to see get retraced. One of them is the 89 price level with these futures charts, another price level that should get hit will be at about the 80 range. A falling US dollar is basically inflation rearing its ugly head, but that is what politicians have wanted for many years, with their 2% inflation rate.

Buying gold after it has already soared does not protect us from inflationary pressures, but this is what gold analysts keep telling us we should do.

They may just be starting to recognize the fact that the US dollar could be in a bear market, which makes them pretty slow in recognizing any trend reversals. When you are watching the evening news and two or 3 different talking heads mention how the US dollar is crashing, then chances are good the US dollar will reverse and soar.

US Dollar Intraday Bear Market Update

The US dollar has made some violent moves lately. One minute it can be a calm decline and the next thing you know it wakes up and swings violently in both directions. Any asset class that is related to commodities has some serious leverage to it. I consider all currencies as a commodity as well. The majority could be just waking up to the fact that the US dollar is in a bear market, which is usually the time when downside consensus forecasts start coming out. This news is a little harder to find right now, but on major turnings, there will be no doubt in how the public will be feeling.

I dropped my degree level down by one degree, which makes the wave action seem more sensitive, which can also get us out of a trap. The degree level is so small that I’m scraping the very bottom of the list.

Any US dollar bear market is not over until more bears jump on this bandwagon going south. On the 10th a violent move up could also be part of a diagonal which contains mostly zigzags. We are presently on a very small move up, but could see more upside before it’s finished. It’s the US dollar decline which is the main driver of the gold price, but other times the inverse correlation is impossible to see for short periods of time.

We will have to wait until next week before we can find out how much more downside in the USD we’re still going to get. We can get a strong counter rally with the US dollar at any time, but it doesn’t mean the bear market is over.

Short term we could see some wild bullish moves, but in the bigger scope of things I’m still very bearish.

US Dollar Intraday Bullish Phase Update

After a great US dollar crash or swan dive, it has now recovered and started to soar with the stock markets again. This rally is not the resumption of the big US dollar bull market, but just a small bearish rally. We will get these small counters rallies all the time, but the trick is not to get fooled by any single rally, even if it travels further than anticipated.

Long term this US dollar can retrace its entire bullish phase, which started in early 2008. The US dollar rally started well before the stock market bottomed in early 2008.  A few places where my parallel lines get sliced in two, is not that big of a deal from my perspective. Trend lines are abused by most technical analysts, as it’s not rocket science to see a trend line. Even a kid with a ruler can see the trend lines without any instructions.  A little more upside can happen, but the reversal should push the US dollar to another record low.

Gold has also reacted down with this US dollar rally, so if gold is still set to soar, then the US dollar is still set to crash and burn. As usual the majority can never take advantage of these cycles, as they don’t have the patience to ride out any corrections.  Emotional traders charge through most of the markets, chasing anything that moves up or down, but the seasoned contrarians get a big laugh out of these market antics. Monkey See! Monkey Do! Seems to be the herd mentality at any given time.

US Dollar Crash Update

Media attention about the crashing US dollar has started to gather attention, when the US dollar spiked to the downside. How much short term downside, there is still to come, is unknown, but the bigger bearish trend is still clear. The US dollar is in a much bigger bear market than what anyone expects to happen at this time. The US dollar will not turn on some mythical price bottom and carry on to new record highs, as  it takes much more than just price to stop any trend.

Sure, short term bullish moves will happen, but not until the entire world hates the US dollar and loves gold, can the US dollar be ready for another new bull market. Yes, we may have some problems figuring out this potential wave 1-2 in Minor degree, as we still have a small window for the US dollar to turn north and produce a “C” wave bullish run.

Also the commercial traders  are back to being net short, but they are starting to add to their long positions. Short term, that may produce a US dollar rally, and slow gold down a bit as well.

The US dollar can backfire and turn into a “C” wave bullish phase. If and when that happens, then we know the top trend line will get sliced in two. The trend line that touches more peaks or dips is the main trend line, and bigger degree levels will wander far outside this trend line.

Maybe raising of the minimum wage this year is causing the US dollar to crash, and not some secret evil currency manipulators.

US Dollar Intraday Crash Update

The US dollar bearish phase has seemed to kick in again, and is now approaching a classic downside breakout situation at the 92.500 price level.  As bearish as that may be the 90.600 price level could offer the US dollar bears another big surprise.  Ultimately, we want to see the US dollar crash below the wave 1 in Minor degree as that is just one way the wave count can get confirmed.

I have not had to change my potential “D” wave top in Primary degree at this time, so there is lots of room for the US dollar to keep moving down, for the next several years or so. Of course, those pesky counters rallies always get in the way, which many think can be the start of the next big bullish phase. Dollar bulls start to throw in the towel, only surrendering to the bears, after most counter rallies start to fail.

In the future the entire mainstream media will turn bearish towards the US dollar, and gold analysts will be urging you to buy into the gold bull market, to protect yourself against the ravages of inflation. The sad fact is, that this is far too late in the inflation cycle, when gold will do little to protect you.

US Dollar Intraday Price Action Review

In Just a few short weeks the US dollar will be starting its second year in a bear market. The mass media still hasn’t caught on, as they think that the US dollar is still in a bull market. As much as some of these counter rallies look like the return of the “Bull”, they are giving the US dollar bulls false hope. Gold’s steady bullish moves so far, helps to confirm this.

The bullish move that started in September of 2017 works as a diagonal move, and since it took longer to play out, I have to look at it from a Minor degree perspective.  The US dollar may still seem a bit sluggish heading down, but I’m sure the US dollar will still have some, “Bad hair days”.

Very bearish stock action this morning helps to make my case, that the bearish action of the US dollar will continue.  When the headlines tell us to get out of the US dollar, and gold is finishing a vertical move, we can expect a reversal of the US dollar, stock, and gold relationship. The entire US dollar bullish phase that started back in 2008, could have been a big bear market rally, and the only way for that to get confirmed, is when the US dollar breaks below the 2008 lows.

Short term we may still see some US dollar bullish action, but longer term the US dollar is in a big bearish phase.

US Dollar Intraday Bullish Phase Update With “Fedcoin” Commentary!

The US dollar has now traveled a bit higher than I would like to see. After some more daily chart reviewing, we could have finished a “B” wave bottom in a wave 1-2 pattern.  Even without the US dollar heading much higher we could already have reached a wave 2 top in Minor degree.  That gap down below will get filled as the US dollar is still in a bear market. 

The majority has not clued into the fact that the US dollar has been in a bear market already.  Bull markets end when the majority of experts are in consensus, saying that the bull market will “never” end. The exact same thing happened in reverse with the 2008 USD bottom when a bull market was born. Until the experts have the consensus opinion that the USD is very bearish, then it will be time for the bear market to end.  This all may sound silly to the majority, but it’s the mainstay thinking that contrarians use. 

There is even talk about a “Fedcoin”, joining about 500 other ICOs in various stages of completion.  

Initial Coin Offering (ICO) Definition | Investopedia

 

US Dollar Bullish Phase Update

In the US dollar bullish run that started in December is a pretty steep angle. We are also getting a double top, and as an added bonus, we have the possibility of a H&S pattern. If I was far more bullish, then chances are good that the H&S pattern will never hold. 

We also have a nice fat gap, still open below present prices, which will get closed in time. There is a 90% chance of any gap getting closed, but some of them could take years to close.  

All those Bitcoin owners who sell and convert into the US dollar will find that the US dollar is crashing. How long would it take to panic out of the US dollar, especially if the only asset class that will be going up, ends up being  gold and silver? 

In the big scope of things the impending “E”  wave decline in the US dollar, could take it to new record lows. When the headlines dominate with US dollar bad news, then we may be ready for another wild USD bullish phase. 

US Dollar Intraday Rally Update

The US dollar has charged a bit higher than expected. Another zigzag rally could be in the process of completing, which I will use as a wave 1-2 in Minute degree.   There is also a huge open gap, below present prices, so this acts like a magnet and eventually it will draw prices down to it. 

With the stock market still acting very bullish, the US dollar could soar in a dramatic fashion.  We do have a questionable Minor degree 4th wave top which gives us a few more options,  than just a single counter rally 1-2 wave. 

Quick US Dollar Update

While many experts have still not clued in that the US dollar bull market ended 11 months ago. Bull markets end under extreme bullish conditions, like the USD did in 2016, while bear markets finish under extreme bearish conditions. (2008)   This has all been clearly documented, so it is nothing new. It happens over and over yet the majority can never take advantage of this, as an emotional herd has no memory.  They don’t learn from what has happened in previous turnings, and even then it is hard to believe that a bull market can start in the depths of a glut!

Those that think the US dollar is still in a bull market, are always looking for the real support price level. Good luck with that as in a bear market, there are no  permanent support prices. 

This rally, which can fit a small triangle should head to a new record low, but it may take several weeks or so to get there.  In a panic the USD can slice through my top trend line, and then reverse. Slicing through the bottom trend line will take a little longer. 

December, 1, 2017 US Dollar Bear Market Rally Update

It’s a new month and I looked at this pattern from a diagonal perspective. That mid month bearish rally fits well as just another “B” wave, followed by a set of little waves to the November 27th bottom.   Since the US dollar can still be in a potential 4th wave rally, we may see the US dollars still thrash around, before another leg down develops. 

Many analysts do not track the US dollar as closely as we do with the stock markets, so we can get blindsided when the USD makes a crazy bullish move.   Is the US dollar slumping because of Bitcoin, we really don’t know, but I’m sure when the new Fedcoin comes out, the US dollar will play a huge role in it.  Any new Fedcoin will send Bitcoin into the digital graveyard, as it is not wise to think that the US government will allow you to make millions trading Bitcoins without paying any capital gains tax. 

For now this bullish US dollar rally has to end adding on another leg to the downside. Every rally with the US dollar can be interpreted, as the lift off to the continuation of the US dollar bull market. That’s not going to happen until the US dollar shows us, that a clear 3 waves crash has occurred, and the news is predominantly bearish.

All I have,  is 5 wave sequences during the entire 2017 decline, with any 5th wave producing overlapping wave structures.  At this time any “D” wave in Primary degree is still valid for the 2017 top. This means that the US dollar can eventually crash below the 70 price level and that 2008 low.  

US Dollar Intraday Decline Update

I believe that September bottom is part of an expanded pattern followed by an impulse “C” wave bull market. The wave count from the October bottom could only fit into a diagonal 5th wave, ending with a very choppy high this month.  In the last day or so, the US dollar started another decline which could produce a H&S downside breakout situation.  If the US dollar makes another fast move down, then the 92.800 and 91.800 price level could find support for another “ABC” crash.

Instead of a 4th wave top, it could be an “A” wave top just as easily.  The best thing that can happen is that the US dollar creates a new record bear market low, which would help to confirm any expanded pattern that I do have.  Gold, and gold stock ETFs, should benefit as the US dollar returns to its bearish phase.

I started the new decline with a small degree level, which would extend any 5th wave decline. US Thanksgiving is tomorrow, so there will be no regular updates at that time. Now if only stocks started another decline, then this would also add motivation to run to gold for safety.

US Dollar Intraday Decline Update.

For now I put my 4th wave in Minor degree back up, for now. The decline sure has diagonal parts to it so that helps to confirm that a potential 5th wave decline is in progress. I do have an alternate wave count for the entire bullish US dollar move, but that is still too early to comment on.  Once we get closer to the 92 price level, the alternate pattern may  clear up some more.   Our present USD rally  has already a small spike in it, but a mini double top would be a better fit. From this wave 2 rally, the next decline should be another zigzag type of a move.

There is nothing that blocks the US dollar from going much higher as “C” waves can do some wild and incredible things. Gold has been sluggish in its rally, but that can be irrelevant when a diagonal bullish phase is in effect. At this time,  a big bearish move is still in the cards, as the 2016 top can be a “D” wave in Primary Degree.   That potential “D” wave top would give the US dollar a full 8 year bear market rally.

I keep my options open as the entire 31 year US dollar decline from the 1985 peak, is just a giant triangle.

 

US Dollar Intraday Crash Update

As much as I would love to keep giving a US dollar bearish wave count, we could be sitting at a slightly expanded 4th wave, corrective bottom.  If this is the case, then the late October peak, will get exceeded again.  It can be fast or slow and even take until the end of the month to fully play out. 

The best bearish wave count would put us at another potential wave 2 rally, but then the entire bullish phase that started in October must get completely retraced. Gold would certainly not like, a US dollar rally. The Euro also created a fast move up and would plunge as the US dollar gets more traction.  Yes, many of these expanded patterns don’t work out, but the only way to get a better fit, we need to learn from every failed wave count. 

Eventually the 5th wave decline in Minor degree will happen after which we could land on an Intermediate degree wave “A” which would be part of an “E” wave decline. The entire pattern would be a single Primary degree move, but consisting of 3 waves in Intermediate degree.

US Dollar Intraday Top Review

In the last month the US dollar rally seems to have died, but an expanded pattern may still be in force. If  that is the case, then this decline should end very soon.   When we draw in,  our missing bottom trend line, then we are very close to slicing this line in two. Commercial traders made all the right moves last week, as they increased their short positions by a large amount. This is a good thing for a bearish US dollar. The Euro exploded, while our CAD heads south with the oil price. 

Nothing but a complete bullish phase retracement will make my wave count happy, otherwise I have to send this wave count to the “Boneyard”. 

US Dollar Intraday Review

Since the last top,  on November, 26th, the US dollar peaked at a bit above the 95.100 price level. Then a decline followed by a sideways pattern, which is now starting to drag out longer than what I would like to see. Just that little wave is enough to trigger a review of the big picture. From the September bottom, I can see that one complete 5 wave impulse sequence could be still in progress.

For now I show the entire sequence as an expanded pattern, but I will also keep in mind that another bigger zigzag can still form. If that happened, it would take the rest of the year, for this bullish scenario to play out. The 5th wave in Minuette degree didn’t fit well to count it out as a perfect impulse,  that’s because it fits as a single diagonal. 

The short gist of it is, there can be more upside still to go with the US dollar.  In this diagonal 4th wave correction, the US dollar can drop very deep, even to the point that it slices through the single bottom trend line. Around the 93.400 price level this diagonal would have dipped into the wave 2  price territory. 

Of course the USD would have to soar to a new record high, but it must never dip below the wave 2 price level.  This would be my least favorite option at this time.  One more move to the upside, would confirm my short term diagonal outlook, but longer term, the US dollar should resume its bearish trend. 

US Dollar Intraday Peak Review

Last Friday the US dollar peaked and then started to decline. No real downside spike has formed so this could be the start of the next leg down. I have to keep an eye open for another decline that can be a fairly smooth declining impulse, but we could also get a drawn out zigzag decline.  The ultimate low to beat is the 91 price level,  as a complete retracement is about the only thing that will confirm that the entire October rally was just another bearish rally or part of one.

I started with Micro degree and will update the degree level as this bearish leg starts to play out. If a shorter zigzag forms, then another wave 4-5 could get added on, but this is the least of my favorite alternatives.  If the US dollar bearish mood returns too soon, then an early counter rally would be close at hand.  I will not emphasize the COT reports too much as they work best at the extremes.

Our Canadian dollar has also turned in the last day or so, but it eventually must reach a new high, if its bullish cycle is just a correction.

US Dollar Daily Chart Rally Review

What we have on the daily chart is a vertical move, that could be the exhaustion wave, of a counter rally. The question is, if another wave 3-4-5 will still happen or if the US dollar starts to head south again?  Our Canadian dollar also took a big swan dive in the last few days, which just confirms the inverse relationship to the US dollar.   When the US dollar decides to turn down, then our CAD should start to turn up.

Let’s say that I have at least 3 possible tops in the larger degree, and that a zigzag decline is still realistic. This 4th wave rally can turn, and produce yet another long extension, before we get to the “A” wave position.  It  would be great if the US dollar ends on wave 1 in Intermediate degree.  The big question is, if the US dollar is in a big bear market or in just another bull market correction? Not until the US dollar shows us, that a zigzag of a bigger degree has formed, can I turn bullish on the USD.

The extreme bullish sentiment that the public signaled to us, on that late 2016 peak has not matched any counter bearish feeling of the same intensity. In 2008 the majority hated the US dollar, and in 2016 they just loved it again, so we still have a missing time period when the majority hates the US dollar again.

Any bearish mood we’ve had recently, is not enough for a new bull market to bounce from. Markets always behaved the opposite of what fundamentals may be suggest at that time.  In the commodity world, swings are far more dramatic, due to the massive leverage built into them.   

US Dollar 2000-2017 Elliott Wave Count Review

When I get suspicious that a wave count is starting to act out another script, then this is always a signal to review the larger picture. This is a regular habit that I adapted with stocks when I was looking for all the extensions.  Back at the top in July 2001,  we had 3 tops very close together before the US dollar started to plunge.

The decline that followed sure looks like a 5 wave decline, including an expanded wave 4 correction.  Expanded patterns like this are very common in any asset class, and ignoring or not counting these expanded patterns, will throw any wave count into disarray.  I have worked this decline as a single zigzag and counted this crash as a 5 wave sequence in Primary degree as well. In the end, 5 waves down in Intermediate degree makes a much better fit.

At that 2001-2002 peak, the 5 wave decline matched gold very well, as gold started its bull market at about he same time. Solar cycle #23 also peaked, so we can say that this solar cycle peak, repelled the US dollar. The majority were very bullish towards the US dollar and stocks,  as the stock mania was still in full force in 2000. Gold was a hated asset class and the experts were constantly warning us to stay away from gold as an investment.

Being out by one degree with this set of 5 waves determines if we think that we are in SC degree or still just Cycle degree.  This important 5 wave decline has a location which can fit very well as a “C” wave decline of a flat. A Primary degree flat! All trends come to an end, and by the time we reached 2008, the world was so bearish towards the US dollar that all the experts were screaming to stay in gold as gold was forecast to go to $5000.

I knew the US dollar bear market would end, but as usual we were early. For now I will use this 2008 bottom as a Cycle degree wave 4 and technically we should get 5 waves up in Primary degree. Many times, 5th waves are diagonal wave sequences, which the US dollar has in abundance.

I think there is more downside to come with the US dollar as many contrarian indicators must also show up. What is also very important with that 2008 bottom, is the fact that the solar cycle was also in the process of switching to solar cycle #24. At this point the US dollar was repulsed by a solar cycle low, which was the opposite of what happen at the 2000 peak.  These events seem to alternate, so by the time we reach the end of solar cycle #24, the US dollar could be ready to soar again or just continue to soar.

Since the 2008 bottom a single zigzag could have finished at the 2016 top, putting us into a diagonal wave two in Primary degree. If this is the case, then we have a wild ride ahead of us, as this correction is still far from over. In this case I posted the weakest wave count, so as to eliminate it as soon as possible.

At this time a small degree 5th wave decline should happen, after which another US dollar counter rally should ensue.

I base my US dollar wave counts on a chart going back to 1792 and the Civil War, which I will post below, but without wave positions.

 

The 1985 peak may be a Cycle degree wave 3 position, followed by a flat or a zigzag in Primary degree. 

 

US Dollar Intraday Rally Update

In the last 3-4 trading sessions, the US dollar has demonstrated is able to rally. For now I will keep the 4th wave degree level until it is confirmed. To confirm it the US dollar has to crash much lower and then create a new record low in the process.  Since 5th waves seem to be the breeding grounds for diagonal waves, I counted it with an expanded “B” wave.  Short term, there could be more upside, but eventually the US dollar should hit or get close to the bottom of my single trend line. 

If the US dollar wants to stir up more trouble, then the chances of  a “D” wave decline could also develop. Any “D” wave decline could produce another great looking H&S pattern at the 91 price level.

I’m sure the commercial traders positions will also swing widely if the “D” wave scenario materializes. “C” wave declines can also be fairly steep and even extend a bit longer than normal. 

Since the 2016 US dollar peak it still works as a potential 5 waves down with one long extended wave 3 thrown in to confuse us.  We would still have Minor degree wave 3,4,5 to contend with, after which the US dollar will make another bull run much bigger than anything we have had so far. This is still far away and could take the rest of the year to play out. 

US Dollar Intraday Bear Market Update

In the last day or so the US dollar rallied and then plunged like a rock shortly after. This left a zigzag looking pattern in its wake, which was confirmed this morning by completing  retracing this zigzag. This looks like it can work as a wave 1-2 at this time. Looks are deceiving most of the time,as I can make this fit as a zigzag with an expanded flat thrown in for added complexity. In the near term the US dollar has to fall well below the 91 price level, just to confirm the previous 4th wave peak. 

Downward pressure on the US dollar helps to keep upward pressure on the price of gold as it crossed the $1300 price level again. 

Last week commercials switched to a net short position again, which was what I was hopping for would happen. Tonights report could be different again, but I’m looking for a switch to a much larger net long position, lasting much longer in time as well. 

Until that time arrives, the US dollar is still in its bear market. 

US Dollar Daily Chart Bear Market Review

The US dollar has been in a bear market for all of 2017, and shows no signs of instantly switching back to its bull market anytime soon. If this entire decline is just a correction, then the US dollar would eventually pass that 2016 peak.  A return to the bull market has a slim chance of coming true at this time. Not until all 5 waves in Minor degree have played out, will the US dollar be ready to seek another larger direction. Even then if the new bullish phase produces wild and choppy waves than this rally will also be a fake. 

Not until the majority hate the US dollar and love gold, will it be time for a potential reversal.  At one time the commercials were net long with the US dollar which was the first time that happened since the 2016 peak. The last weeks COT report saw the commercials turn net short again, which was what I was hoping for. The commercials would have to be net long by a wide margin and for a long period of time before a big USD bull market can surprise us. 

We also have a mini H&S pattern setup with the right shoulder being a potential 4th wave peak. 

I would be wrong trying to give readers a bear market bottom price forecast, because in the long run the USD can completely retrace its entire 2008-2016 bull market. If an alternate wave count is in the works, then after the 5 waves in Minor degree are completed, we could certainly see a big surprise.

The “D” wave I show can turn into a  diagonal Primary degree 4th wave just as easily, which means another zigzag is in the works, but no new record low will happen. This is my least favorite option, but I like to keep alternate wave counts on the radar screen. 

US Dollar Intraday Bullish Phase Record High.

There is only one trend line that touches 4 peaks while the bottom trend line is not even worth drawing, as it would only touch one wave bottom. Now if I added a bottom line across several wave bottoms, we would end up with a wedge. Any wedge would suggest a violent move to the downside, but 5th waves can be very boring and develop choppy waves,  that would slow any 5th wave at the best of times.   Any kid with a ruler can draw trend lines, but many experts abuse trend lines to a point where they become useless in forecasting anything. The US dollar would still have to go vertical to trash the top trend line, and short term this may happen. 

In the long run, starting from the September 2017 bottom, we have what looks like a zigzag. I can also turn the entire bullish phase into a flat with a 3-3-5 wave count. Either way, it works as a bearish rally, which eventually will retrace 100% of the entire bullish move which started on September the 8th. 

We also have several gaps open below,  which should get closed off in the next few weeks or even months. In the long run this US dollar rally is a wave 4 in Minute degree, after which we have one more set of waves 3-4-5 in Minor degree, to contend with. 

Most of the markets created downward pressure this morning, which is not favorable for a continued US dollar bullish path. 

US Dollar Intraday New Record High Review

I was hoping that the US dollar would make a strong turning, but instead the US dollar pushed higher in another leg up. The last leg up looks like a zigzag but in smaller scale of things we can see a small set of 5 waves. The worst that can happen is another small wave 3-5 gets added on. This bullish phase all started when the commercials became net long for the first time since the US dollar bull market ended in early 2017.   They were the only net long by a few contracts, but for a major turn, their positions would have to be net long by a wide margin. 

When Friday’s report comes out, they could be adding to their short positions, which is what I like to see.  This USD bullish phase also shows in a small way how bullish stocks compete with gold and gold stocks. Technically speaking, if this entire bullish phase is an inverted zigzag,  then we should see the US dollar completely retrace its bullish phase starting point in early September 2017. 

The US dollar is also getting very close to the tops of the previous correction so that can add to any resistance pressures. I may have mentioned the 94 price level before, but it took this long to get there. 

US Dollar End Of The Bullish Run?

I would love to see then end of this US dollar bull run, and this morning the US dollar may be cooperating so far. Nothing but a new US dollar bear market low will satisfy my bearish wave counts. We still need to be vigilant, if this bullish phase still has some bullish move up its sleeve. 

At the 92.200 price level, we do have an open gap so that would be a target price level for some temporary support. Just above the bottom of the 4th wave in Subminuette degree, there is a small gap which must get retraced first. Any US dollar high could also be the last high for this year, but that would need to eventually get confirmed by market action.  

Any US dollar bearish phase can return the attention back to gold and their share prices. 

US Dollar Bullish Phase Review

 

We were expecting a counter rally and we sure got one. In the last few days we can see that the pattern had changed again as the subdivisions got smaller. At the very least we should get a correction back down, but how far would be just a best guess. The US dollar could crash well below my bottom trend line before it ends up soaring one more time.  There is no way that the US dollar is off on some huge new bull run, even though the commercial traders are net long with their US dollar positions. By this Friday it could all be switched around again.  

Commercial traders are also net short our Canadian dollar and the Euro which are both currencies that travel inversley to the US dollar. The commercial positions would have to shift much more to the extreme side before a switch to a long term bullish phase will happen. 

In the short term we have to put up with this bullish phase, but longer term the US dollar still has a long way to go down 

US Dollar Daily Chart Bear Market Update

I regularly review the US dollar from its 1985 peak, and since then any big bull market we have had, turned out to be a fake bull market. They are fake bull markets when these bullish phases are completely retraced. The last day of 2016 the majority were very bullish on the US dollar and stocks, and bearish on gold. For now I can keep my Primary degree “D” in its position, but it can also double as a 4th eave top. As a “D” wave top of a triangle I would need another complete zigzag to help make my bearish case. Even though the dollar declined the stock market surged the entire time. This is not all that unusual as the same thing happened with the 2002-2007 rally in stocks. 

This 2016 peak is now the third peak since 1985, and it too could end up being a false bull market. When the USD falls below 89-88 it can  still be a diagonal 4th wave decline. This is a low probability, but I have to be open to alternate wave counts. 

The commercial traders are still net short on the US dollar, with the speculators still in a net long position. Until this scenario flips between the two groups I don’t think a huge bull market will suddenly start. One story I read which I consider could be fake news, is that Trump has a surprise for the US dollar in early 2018. Maybe he will try and shock the US dollar back into a bull market? Good luck with that, as it would take a major shift in policy to do turn the US dollar into a bull market.  Most of the time flapping at the mouth will just have a temporary effect. 

Sooner or later the US dollar would have to slice through the top trend line, to help confirm the next larger degree.  One “A” wave support price range could be between 83 and 82, so if Trump has the power then that would be the best time to implement it. 

I will remain bearish with the US dollar until the intensity of the bearish news starts to increase. 

US Dollar Intraday Gyrations Update

The US dollar has been displaying wave patterns that overlap each other at critical places. In a diagonal wave is when we can overlap, but then they are connected together with zigzags. On the 9th the US dollar reversed and has now started to back off after finishing with a little spike.   At 91.300 we have a little gap, which will get filled in due time. 

The US dollar could still have some correcting left to do, with a down move and then another up move. No, the US dollar bear market is not finished as I think there is more to go.  There needs to be a few other indicators that have to line up before the US dollar heads northbound in a major bull market.  Far more bearish news has to come out consistently and far more analysts have to become bearish towards the US dollar. 

The commercial net long positions should have switched by a wide margin, before a major reversal can happen. Small reversals will happen many times which can fool us into thinking bullish thoughts.   Dr. Doom blames the declining US dollar on bitcoins popularity, but it is bitcoin that has lost 20 billion in just a few weeks. 20 billion all went up in e-smoke after  Dimon from J.P. Morgan calls bitcoin a “fraud”.  The average person will get burned fooling around with bitcoins’ and no matter how much they speak against it, many will still speculate with it. 

The 5 waves down in Minor degree are not finished, but when they are, we have to see what type of a correction we will get, and how sideways it will travel. 

September, 1, 2017 US Dollar Intraday Bullish Review

About mid August the US dollar peaked and then started a very ugly decline which I can get fit into a diagonal.  The US dollar crossed to a new low with a 3 wave move, not an impulse by any stretch of the imagination. It sure looks like a diagonal 5th wave, followed by a violent reversal right back up again. I show that there is the possibility of another correction still to play out. Straight up moves can be very deceptive, making the “A” wave another potential 4 wave peak as well. 

In the next few weeks we should know more as the USD can resume its bearish trend without pushing to a new high. This would retrace the entire 5th wave decline before it resumes its bigger bearish trend. 

A declining US dollar makes most imports cheaper to buy from the USA, but would certainly increase any inflationary forces already in progress.  True inflation can only happen when wages increase dramatically every year like they did back when I started to work in the forest industry. With pay raises being so low in general today, this will have limited impact on inflation numbers in the future. 

I may rework the “D” wave top I have used, but I don’t want to do that too early as a few other indicators like the COT reports would have to shift first.