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Category Archives: CURRENCIES

Canadian Dollar Daily Chart Update

Since last August, 2017 our Canadian dollar has gone wild, with swings up followed by dramatic declines. As soon as our dollar went higher than the previous little bump, the bearish scenario was trashed at least temporary.  This can work as an expanded triangle and it looks big compared to any wave 1-2 that I have.

From the “D” wave top to the “E” wave bottom we only have a 7-wave count which works as a zigzag very well.  Any triangle pattern that we may have must not break below my 4th wave position because if it does, then chances are good my diagonal scenario gets reused. Market action has not forced me to change the bigger degree positions, but this little rally is either going to blow past the top trend line, or it will fail.

I have high confidence with my 4th wave scenario, but some of  the smaller moves  sure test my patience. Many times the CAD has also turned around close to months end, so it could take until May before this rally gets resolved.

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US Dollar Daily Chart Update

The decline of the US dollar has been in progress just under 13 months and I’m sure there is more to go, but short term radical moves can kill any wave count pretty quick.  The 4th wave peak in Intermediate degree is still holding, and I see no short term moves that will dislodge it. This blog is all about locating, and confirming all 5 waves in Cycle degree, and EW5  is the only blog I know of that is doing this. I say this so all new readers fully understand that  smaller degree wave counting must come before all the big wave counts can be justified or even confirmed. This also applies to currencies like the US dollar.

At this time I don’t think we are in any Minor degree just yet as the switch would have to counter rally much further. In this case the USD could be finishing a Minuette degree 4th wave,  which could be followed by a 5th wave extension. International trade wars are in progress, but I think it’s more about Cyber Wars that all major nations are conducting. The US dollar is caught in the cross hairs as it seems that the USA infrastructure is also a prime target for these attacks.

We can get all sorts of rallies, but none of them will charge back into a bull market., at least until all the commercials are net long by a very wide margin.

We also have to be prepared that the US dollar can soar when stocks make a huge counter rally. COT reports come out on Fridays and if there is a radical change I will talk about it.

The Euro could also see a pop so when the US dollar moves many other currencies will also react.

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Canadian Dollar Daily Chart Update

The largest degree and wave pattern I show at the top is an Intermediate degree 4th wave.  Since I show an inverted zigzag this would mean our Canadian dollar was in a big bear market rally and when that is identified correctly, we know that a complete retracement should happen. Since the December peak our dollar has only produced one big lower high, but has produced several smaller lower highs on the way down.

With a 4th wave top in Intermediate degree, we know that we should expect a 5 wave decline in Minor degree.  That’s in a perfect world, but a diagonal decline can also produce another declining zigzag. Another zigzag is my  least favorite option, so for now I will stick with a 5 wave decline in Minor degree.

There still could be some short term upside yet, but then our dollar should reverse and head south again. Back at the February 2017 price peak of, .81 cents could be the highest reading for all of 2018. The February peak could still take many years before it is retraced so we have to buckle up and ride this bearish roller coaster for a lot longer.

Once this rally reverses, then a new low should happen, but then we could be setting up for a wave 1 bottom in Minute degree.  A wave 1-2 in Minute degree is the second set of a 1-2 wave count and the third set of 1-2 waves will be in another set of 5 waves in Minuette degree. Each set must be one degree lower and by the time the time the third set arrives, they will turn invisible.  Being specific and then the markets do the opposite, we know that a review would be instantly called for.

The 4th wave top in Intermediate degree is painting us a picture that this wave count has advanced past a Cycle degree peak, which was back in late 2007 and it’s still not finished. The 2007 peak was a wave 3 in Cycle degree.  When joining the peaks and the  bottom we sure can produce a big wedge, at least in Primary degree. When the wedges are finishing then this is a very powerful setup for a potentially new bull market phase that can last another 5-8 years.

The explosion of the VIX is a prime example, how powerful wedges can be in forecasting huge moves in advance. Right now, I’am getting a small collection together, which have huge Primary or Cycle degree wedges in progress, with many of them still being 2-3 years away from completing. Identifying these big wedge formations early is the key, as it’s all about “seeing it coming” that’s important.

The “Wedge” and two parallel lines are my two trend line configurations that I use, but I try to keep that to a minimum as when they use trend lines too much, they lose their importance.

Even though the commercial traders have small net long positions, they can stay like that for a very long time. Is a 10 year bear market long enough for you, or do we need a 13 year bear market before our CAD turns super bullish again.

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Quick US Dollar Intraday Update

This is just a quick update as this potential “C” wave could be running out of steam. I would still like to see the USD spike to a new higher high, but that has  a 50/50 chance of happening. 50/50 odds does nothing for me as I want better odds than just flipping any coin for heads or tails.

I will never call this type of a move as a “Truncation” because they can work as running patterns very well. Even any zigzag can come up short, so it’s not like it can never happen. Next week could destroy the top trend line, but otherwise the US dollar should  resume its crash course.

Sure, there will still be many counter rallies, but the only real counter rally is the one that sends the USD back into a multi year bull market. That will not happen until the US dollar bears become trapped again, much like they were in late 2008.  This time it won’t take 8 years or so, but should only last 3 years at best.

The US dollar index is being drawn down towards solar cycle #25, much like the USD was pulled down to the solar cycle #24.  From this 2008 low the US dollar exploded right along with solar cycle #24, so I expect a US Dollar bull market after solar cycle #25 as well.

There is a huge USD wedge that will be finished in a few years, and these wedges can produce powerful bull markets. The VIX is a prime example of what happens when a wedge comes to an end. 1937 to 1942 also produced a wedge, and that wedge spawned a multi decade bull market.

 

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US Dollar Intraday Bullish Phase Update

The US dollar roared to an early March top, then proceeded with a bearish phase that sure can fit into a flat. By about the 27th this correction was over and a bullish phase started which is still in progress.  In this case I would love to see the US dollar  soar and completely retrace the top, as that is what corrections are supposed to do.

From my perspective the US dollar bear market will resume until my contrarian indicators start to tell me otherwise.  The commercials are still net short the US dollar, but the speculators are getting close to a 1:1 net short/long ratio. I don’t want to see an even ratio, but I would like to see the speculators become extremely net short before I turn bullish on the US dollar.

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US Dollar Another Downside Breakout!

The US dollar is under pressure and it is right on the wire at the 89.400 price level. That’s only a hope skip and jump away from the Fibonacci 89 price level. I could paint you a very bearish US dollar picture just by flipping my trend lines at a very steep angle.  I’m sure there is more downside, but once it reaches the bottom trend line, we could be finishing a flat type correction.  This could ignite a “C” wave bullish run in the US dollar, and before you know it it will be over as we may be in a wave 2 rally.

The US dollar could fall well below my bottom trend line, but that would only make for a shorter “C” wave move.  It can still take all of next week for the USD to show its true colors in the short term.

Longer term the US is going down until everybody starts to hate the US dollar again. Besides that the commercial traders reports will become skewed. This time it’s the speculators that have joined in on the bearish side as they too have become net short by about a 1:1 ratio. Nothing to get excited about, but those numbers will shift and until the speculators have pushed their short positions to the extreme, we’re not going to get a huge bull market.

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Canadian Dollar Daily Chart Review

Our Canadian dollar executed a swan dive that now has come to a bottom and has started to rally. At the same time we have a pattern that sure looks like a triangle. If this is the case, then the CAD can still soar much higher until another new record bear rally happens. This is the bullish scenario that still may play out, but all that means little if our CAD starts to break to the downside again.

We may need to give the CAD a bit more time to see if higher lows also start to develop. Higher lows at the intraday scale would not really help because the wild swings can slice through any trend line. In this potential triangle the first zigzag is missing so the very top can still stand as my “C” wave top.

It is the August 2017,  3 wave rally that can belong to the diagonal bullish phase. Our present move can still wobble around until the end of the month, so anything can still happen in the short term.

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US Dollar Intraday Gyrations Update

The US dollar had made the small move I was expecting, but I don’t think it’s over just yet. The US dollar could plunge back down to the 88.800 price level, then make another move to the upside which could be the end of a wave two rally in Minor degree. This  could still take all of March to finish off, but I’m sure the Fed announcement this coming week, will create some wild moves in both directions.

The speculators are very close to being even with their positions, so they will have to shift to a major net short position when the US dollar hits another major bottom.

The commercials made all the right moves last week and they are still in a net short position by about a 3:1 ratio. Once this corrective counter rally has played out, then this should also have a positive effect on gold.

Any Fed policy will not push the US dollar into a real bull market, no matter how many analysts may think that it can happen. This entire US dollar decline can take until the end of solar cycle #24, which is still a few years away. Every major science site that tracks the sun will be recording and reporting this event, so there will be no excuses that we didn’t see solar cycle #25 coming!

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Canadian Dollar Futures Daily Chart Update



At this point our Canadian dollar is still sinking that some say is the end of the Candaina dollar bull market. Hate to break the bad news folks, but the Canadian dollar bull market ended about 10 years ago. What we are in is the impending end of our Canadian dollar bear market. This end is still a few years away as we still would have wave 4-5 in Minute degree  to work through. We know what a pain in the ass some of these last waves can be, as the markets will always throw something at us to keep us scratching our heads.

Commercials are net short and that situation would also have to shift to a point when commercials are net long again by a wide margin.

Right now our CAD could be getting close to being a single flat, so until we break the May 2017 lows, our CAD can still reverse. So far this would be the least likely scenario, but a another counter rally should happen by the end of next week.  There are many turning points following the month to month pattern, but that is not written in stone.

So far the rally peak in 2017 looks like an inverted zigzag did play out, which means 100% of the entire bullish move that started in 2016 should get retraced. The CAD is going down along with the solar cycle #24 which means that solar cycle #25  pulling the CAD down. Any  end to the big CAD bear market, could take until solar cycle #24 has ended.

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US Dollar Weekly Chart Review


This year the US dollar is having problems getting past this 88-89 price level, which the bottom trend line highlights. The herd of conventional analysts is just starting to suspect that the US dollar is in a bear market. This is far too late, to be any use to the futures traders that know how to bet up or down. (Take long or short positions)

Conventional indicators in the highly leveraged commodities world doesn’t work, because if they did the majority would always be the winners. The fact is the majority can never win because it is mathematically impossible to do so.

The US dollar bull market that started in late 2008 displayed a choppy bull market that happens in false or bear market rallies. In a bear market rally, the market eventually must retrace its “entire” bullish move, which would not be completed until the US dollar travels below the 70 price level. This  would take a few more years or until solar cycle #25 starts up.

I want to see the US dollar slice through that bottom trend line, as we still don’t have a great looking spike. The US dollar has already entered the price territory of the 2009 and 2010 peaks, which effectively  kills any idea that a perfect impulse was in progress.

Still there is no real bottom that can offer price support to the US dollar  at this time. Every time analysts are looking for support, you have to ask, “support for what”?  Support for a huge US dollar bull market to suddenly materialize?  From my perspective, some key contrarian indicators have to be in place before the US dollar suddenly leaps into a bull market. None of those conditions exist just yet so until they do, the US dollar is doomed to decline even more.

It was a real challenge to call the 2008 bottom as we were far too early, but finally the US dollar started to soar, and our CAD and  Euro started to implode. When we constantly read about the bearish US dollar, chances are good that a strong reversal is being set-up.

Short term we could still see some gyrations, but long term the US dollar is still doomed to go lower.

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US Dollar: Resuming it’s Bearish Trend?

The US dollar has been in a bearish mood lately, but it can still create another corrective pattern as well. 89 is just one rounded Fibonacci  numbers I use, and the US dollar has turned around that number before. Commercial traders are still net short, so chances of jumping into a huge USD bullish phase are low on my list. Wild counter rallies do happen and they can’t always be spotted before they happen.

Any decline in the US dollar for “any” fundamental reasoning, will help keep the bullish pressure on gold.  At least until the entire US dollar bearish move has completed. There are no contrarian indicators showing up,  that say we are at the bottom of a US dollar bear market.  We might get another “C” wave attack, that can force another leg up with the US dollar, but then I would bet that the commercial traders positions would also have shifted dramatically.

In the last few days, the declining  pattern has been a diagonal pattern, which could run out of steam in the short term.

This could be very slow going as well, so I will not report every little wave made with the US dollar cash index. Futures are leveraged asset classes which produce very wild moves. Futures are played in both directions creating these wild swings, which Bitcoin traders can’t really do. The lack of  short players in Bitcoin reduces the wild moves, otherwise the Bitcoin waves would display insane moves in both directions.

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March, 8, 2018 Euro Intraday Correction Update

The Euro bullish phase is still in tack, but it must push higher to confirm it.  Another 5 waves up in Subminuette degree will do it, but we need lots of patience to wait out any extensions that may still come. 5th waves are notorious for extending in commodity charts, and may even start out as a diagonal pattern. Commercials are net short with this futures chart, so a screaming sustained bull move is highly unlikely. We would need a strong correction like a wave 2 in Minor degree, but we are still far away from that at this time.

I would love to see a 4th wave triangle first, then I would change my outlook after the “thrust” has completed. These “thrusts” can also be short and sweet and then turn early very quickly. We have a major double top, that the Euro has to break through, and that may not happen until we get closer to the end of the month.

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March, 8, 2018 Canadian Dollar Intraday Crash Update

Our downside breakout has happened, but there is still more to go. The September peak ended on a “C5” wave terminating a high quality zigzag in Minor degree.  If this Minor degree top is out by one degree higher, then this shows that the big decline came from a Cycle degree top.  With the Minor degree top, my bull market top in 2008 must be a Primary degree.

I suspect the CAD is going to create a wave 3 extension, which could make any 5th wave shorter. Commercials are net short, so there is no reason to expect the CAD to suddenly turn north in another huge bullish phase. The only support we may get will be temporary,  until the majority are freaking out about how bad our CAD has become. This may not happen until the CAD is well below the 68 cent price level.

These are futures charts and a stand alone asset class, which can be played in both directions. Up or down, long or short is all that matters!  This impending decline may still take a year or two, but after that our Canadian dollar could go into a huge bull market.

All this “Tariff War” hype can get serious, but markets have a tendency to ignore much of the hype or the hype is irrelevant. Canada is going into a recession and the CAD is imploding with it. I don’t think that the USA markets are going to keep soaring, if Canada is slipping into a recession.

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US Dollar Bear Market Returns?

The general direction of the US dollar is still down. It’s declining in a choppy fashion so we could be looking at a 5th wave diagonal decline.  The Euro jumped as the USD declined, but the Euro is a better looking rally. It’s not a beauty contest, but a war between bulls and bears.  Right now the bears seemed to be winning as the USD slowly keeps  grinding down.

The commercials switched to a net short position, so this helps in knowing that a super bull will not suddenly possess the US dollar holders.  I think the US dollar still has to fall well below that 88.200 price level, but it must also be finishing the big Minute degree decline.  Price alone will never give you the basis of a major reversal, but patterns do. Yes, I use price, but it’s always associated with the pattern I may be working. Price forecasts by the experts sure didn’t help to forecast the end of the US dollar bull market, so why should they know when the US dollar bear market is going to end?  The experts never saw the end of the 2008 US dollar bear market so why should they this time around?

Nobody was expecting a media trade war to be conducted at record peaks of the stock markets, but they did.  The big question is if the US dollar bull market that started in 2008 was actually a fake bull market. Bear market rallies always produce total retracements which in the US dollar case, would be well below the 70 price level. It will be a tough call once this US dollar 5 wave sequence is done, as a strong US dollar rally would have to happen.

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Canadian Dollar 1980-2018 Monthly Chart Review


On my last Canadian dollar daily futures chart update, I had the recent peak as a 4th wave top in Intermediate degree. I can spend the entire weekend reviewing it all, and I “always” do this manually with pen and paper. Once I get a hand drawn wave count looking decent then this wave count gets scanned into my computer. Most analysts would be completely lost if they had to double check for errors by hand!

I realized that the 4th wave in intermediate degree only worked for a higher degree, so with this version I dropped my Intermediate degree 4th wave, down to a Minor degree 4th wave top.  Any one single degree change like this always has a domino effect, and all wave positions must be redone to as far back as we have records for. That sounds too much like work, so the majority of expert wave analysts practice cosmetic wave counting. I practice what I call “structural” or sequential wave counting.

Being in a degree higher than we should be, makes all the wave counts far less sensitive, and causes us to miss complete bull markets.

Worse yet we may not see a bear market coming, when all contrarian indicators say a bear market is coming. This CAD bear market has been around for 10 years already, and our recent decline should start to confirm this in the next year or so.

I have mentioned that a triangle is pretty rare, but I think I do have a few of them. On the late 2007 peak, I have a wave “D” in Primary degree and an “E” wave in Primary degree, must follow. We can’t have 5 waves down in Intermediate degree, because it simply will not fit mathematically and sequentially.  The largest 5 wave sequence I can have anywhere “after” the “D” wave, is a Minor degree run.

Canada is going into recession and it sure is not going to go alone. Many have said that our CAD follows the oil price, so if this is true, then a crashing oil price must also resume.

The mass media has declared a “Trade War”.  I’m sure many countries in the world will retaliate until we’re all in a worldwide recession.

The mass is starting to clue in, as It’s not rocket science to know what is going to happen, when taxes or duties are increased   dramatically.  Just read what happened when the Smoot-Hawley Tariff Act was passed in June, 17, 1930! This is the worlds second trade war in a Fibonacci 89 years.

In Ontario they voted in a 20% minimum wage increase and look what happened there, as thousands are losing their jobs.

Our CAD has lots more downside left, until the commercials shift into new net long positions again. Unloading our Canadian dollar will become the new favorite pastime.

Our dollar is imploding down into the bottom of cycle #24, so when this completes we could get a massive Canadian dollar reversal that would last for many years.

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Canadian Dollar Daily Chart Crash Review: Downside Breakout?

With this daily chart I show a potential zigzag and a 4th wave top in Intermediate degree. (Red). Our CAD has been taking a real beating as our famous “selfie king” fiddles. Trudeau has been on a wild spending spree burying our country into debt. Justin Trudeau has been snubbed in China and India. If he  thinks he can survive a tariff war with president Trump, then he is going to get a big surprise. A recession is coming and it is starting in Ontario with the 20% pay raises, the Ontario government voted in. This produced massive amounts of layoffs in the service sector, as restaurants cut back on employees. Governments engineered the minimum wage increase so they should be blamed for any recession about to come our way.

Last weeks commercial traders positions were still net short by a ratio of about 1.82:1. This isn’t too far out of wack and may even shrink if our Canadian dollar keeps imploding.  Right now the CAD is sitting just a bit above 77 cents, and I’m sure that will not hold. If all this is showing an Intermediate degree 4th wave top, then we should get 5 waves down in Minor degree. Our CAD would have to retrace the 72 cent price level and then even get close to the 68 cent price level.  The 68 cent price was hit in early 2002 after which it soared to the 2007 peak, before it crashed again.

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Euro Intraday Bull Market Update

Our February Euro peak sure can fit into a triangle. Triangles have been on the rare side, but I have more than just one asset class that a triangle has formed. A triangle eventually spells doom once the “thrust” has played out. In this case I need 5 waves up in Subminuette degree. That could take another full month to play out, and anything less than a new bullish breakout would be unacceptable from my perspective.

The Euro is in the US dollar basket, but many times it acts inversely to the US dollar. As long as the US dollar still has downward potential, then this Euro futures chart can still soar. Eventually this 5 wave run could end up at a wave 1 in Minor degree, followed by another Euro crash/correction.  Gold should benefit from all this turmoil in the markets so the gold bull market is not dead just yet.

Today’s COT report will tell us more in what the commercial traders have done.

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US Dollar Intraday Crash Review

This US dollar index rally hit a brick wall on the 1st of March right on the same day we had the full moon. Last week the commercial traders were still in a net short position so the odds of a huge bullish move are reduced dramatically. A small set of 5 waves heading down, has already formed, but this should build into bigger counter rallies as the US dollar adds on another set of 5 waves in Subminuette degree.  What type of 5 wave sets is not clear, but any 5th wave can turn into diagonal waves.

If what we see has been a bearish rally, then the US dollar price level of 88.300 “must” get hit or breached. No US dollar triple bottom will hold once we get closer to that bottom trend line.

With president Trump conducting a trade war with new tariffs on steel and aluminium, should not be a surprise, as he made it pretty clear to all during his election campaigns what he was going to do. The last time a president conducted a trade war was with the June 1930 Smoot-Hawley Tariff Act. The Smoot-Hawley Act came into existence a month after the 1930 “B” wave top in Cycle degree. 4-5 months for a Cycle degree bear market rally in stocks sure does not fit the timeline length but it fits sequentially very well.

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Euro Intraday Bearish Phase Update

Since the January bottom the Euro has made a great 5 wave run.  This morning the Euro broke that 1.22 price level, which could have been a base for another small run of 5 waves.  The Euro is in the US dollar basket, which runs inversely to the US dollar. The US dollar basket is destined to be changed as some currencies will be removed but other main trading partner currencies will be added.  The changes in the US dollar basket are just opinions right now, but it will be interesting to see if my big US dollar wave count will be threatened.

Besides the potential for a wave 1 peak in Minor degree, we could be at an “A” wave in Minor degree just as easily. It could mean a 60-80% wave 2 correction can happen, and it won’t stop at the obvious previous 4th wave in Minute degree. Commercials are net short the Euro, and until that changes dramatically, the chance of a super Euro bull run may just be a pipe dream.

Still, we need to keep our options open, as no wave count is etched in stone. Only the idealized charts are etched in stone.  😀

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US Dollar Intraday Bullish Phase Review

Since the January bottom the US dollar roared up in a zigzag fashion and then plunged down with what looks like a set of 5 waves down. I have an extra bounce during the early part of February which can also work as part of a diagonal. Sooner or later the US dollar should complete any bullish moves, but can still frustrate us to no end,  in the short term.

Investors love to see the US dollar soar with the stock markets, as it seems that investors are still infected with the “Stock Mania Virus”.  Stocks and the US dollar, soaring, caused gold to crash this afternoon.  We may see more upside with the USD but eventually it will resume its bearish trend.  We could still more upside, but last weeks COT report, the commercial traders are net short the USD.

US dollar investors have to get to a stage where they are extremely bearish towards the US dollar, and the commercial traders are piled in with huge net long positions.  Short term the USD bull may still dominate, but long term I’m bearish on the US dollar. (2-3 years)

I’m sure that once solar cycle #25 starts, the US dollar can turn and soar once again.

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Canadian Dollar Daily Chart Review

The commercial traders are net short our Canadian Dollar which sure doesn’t motivate me to look for bullish wave counts.  Commercial traders were net long back at the May 2017 bottom, after which the CAD roared with a blistering bullish move. All good things must come to an end and our CAD has been taking a beating in the last little while.

The rally in early 2018 has now turned into a bust. This move sure looks like an inverted zigzag or it  could also work as a flat.  Either way  an inverted corrective always calls for a complete retracement, unless we’re part of a diagonal move.

In this case the Canadian Dollar would have to fall below the,  .775 cent price level, and then completely retrace that, . 725 cent  price bottom, as well.   I’m sure anything can still go wrong, but as long as the commercial stay very bearish I can’t see a super bull market in our CAD anytime soon.

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Euro Daily Chart Update

What sure looks like a good impulse run seems to have come to a screeching halt. Once it breaks the 1.22 price level, it would trash another small run higher.  At the same time the US dollar also seems to have a shortened 5th wave and it is still soaring as I post.

The commercial traders are net short the Euro so until that situation switches, the Euro could make a deep plunge. If a wave 1 in Minor degree has completed, will the Euro fall back to the previous 4th wave of one lesser degree? The Euro may not stop at the 4th wave above because first waves can crash 61% of the entire net move. This could send the Euro down to the 1.12 price range before it’s ready to turn again.

On top of that we must see a decent physically sized correction, completing as well.  What could be worse yet, is if this entire rally, was a “C” wave bull market.

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Canadian Dollar 2011-2018 Review

Since 2011 our Canadian dollar peaked out and then proceeded to crash right along with gold. Then in early 2016 the CAD crashed to its lowest point and then proceeded to charge up in what can fit into a perfect inverted zigzag. I only see a 5-3-5 regardless how short the C% wave may be. Technically speaking an inverted zigzag is a bear market rally, and bear market rallies always retrace their entire bullish moves.

We also know that zigzags can lead into the first part of a bigger flat. A Minor degree zigzag could lead into the first part of an Intermediate degree flat. The commercial traders are net short the CAD by a bit less than a 2:1 ratio, while the speculators are net long by about a 2:1 ratio.  I would still be bullish on our CAD if the commercials were all shifted to a net long position, but they’re not.

Our present little CAD rally looks like a fake attempt, but we need more evidence to help confirm this. I’m looking for any decline to show us that another correction has completed, because that is the only way when our CAD can soar again.

It’s not that simple as a diagonal 5th wave can also contain another zigzag as it finishes the 5th wave decline.  Any potential flat correction cannot fall to new record lows and could send the CAD into a wild “C” wave bull market in Intermediate degree.

It may take several months for any corrective decline to get cleared up or confirmed, and then I would like to see the commercial traders become extremely net long towards our CAD as well.

At $.72  our CAD could run into some very strong support, so anything can still happen.

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US Dollar 1980-2018 Update

 

Way back in 1980 the US dollar bottomed and then soared in an insane vertical move which I think ended with a wave 3 in Cycle degree. We can say that Regan was responsible for that rocket move. 1980 was also the peak of solar cycle #21, so the US dollar repelled up from  the sc#21 peak.

Then from the 1996 sc#22 bottom, the US dollar did the opposite thing and soared again until the peak of sc#23 in 2000. From this sc#23 peak the US dollar repelled in a big move south that didn’t end until sc#23 bottomed in late 2008! For about 8 years the US dollar rallied with the run up of sc#24, but then the USD also repelled from the SC#24 top in 2014.Now the US dollar is heading south as sc#24 is also heading south.

By 2020 or so sc#24 will end and then we start up in sc#25. SC#25 could be a huge bullish setup for the US dollar. The big thing is that the US dollar, solar cycle action, always seems to alternate. This alternation action doesn’t happen in the main stock indices, as the solar cycle bottoms can produce real wild bull markets. These bull markets can also be maintained right through the entire solar cycle decline which it has done on this sc#24 decline. A few of my contrarian indicators also have to be lined up, when it’s the right time.

We do have a few years time before extreme indicators show themselves. The majority must hate the US dollar first, but right now you are lucky if the crowd even suspects that a US dollar bear market is in progress. Conventional meanings of bear markets and bull market corrections, mean very little to me as commodities, mainly run on leveraged fear. Fear has nothing to do with logical! A 61% crash can just be a wave 2 correction, and many 4th waves can see a 40% drop. Both moves would still be a bull market correction from an Elliott Wave perspective.

I also see a potential huge wedge being setup so that sure could send the US dollar soaring as well. This will not happen next week or even next year, but looking a few years ahead should be our constant focus.

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US Dollar Intraday Crash And Rally Update!

The US dollar has resumed its downward path recently while the Euro charged up. This is the great inverse relationship that also influences the price of gold in US dollar terms. As long as the US dollar remains bearish over all, the gold price should keep on benefiting.  It also works the other way, when the US Dollar is set to rally, then it usually crushes the price of gold as well.

The gold price got crushed in 2011 as stocks took off  and the US dollar charged up during that time.  The US Dollar hit another record low this morning  before it reversed and charged back up  ending with another small spike to the upside.

To finish the 5th wave down I need 5 waves down in Minuette. Since it’s a 5th wave decline, this 5th wave can extend dramatically so there still could be some downside left in the short term.  Sooner or later we  may end at a wave 1 in Minor degree and then a strong US dollar rally should happen.  It could be a slow move or a violent wave 2 counter rally, but in the long run the US dollar should resume its bearish trend.

A rally does not make a bull market, but a rally big enough sure can fool the crowd. The easiest crowd to fool are the speculators as they always get themselves into a trap. Recognizing that a trap has formed or is forming, allows us to get out of or into positions,  that otherwise very few people can ever execute.

In order for the US Dollar to turn back into a real bull market, we need the commercials to switch into an extremely skewed net long position. They are net long already, but not nearly enough for a super bull to materialize. The bearish phase can still last until the end of the month, so until I see all 5 waves down being completed, this bearish phase is still active.

If we are approaching a higher degree wave 1, we could get some very choppy declining patterns indicating that diagonal waves are starting to dominate again.

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US Dollar Bullish Cycle Still In Progress.

There still is a threat of the US dollar to head a bit higher as sideways movements can’t be trusted for very long. We could add on a wild little spike to the upside, which can always produce fantastic reversals. From my perspective, this is a 3-3-5 move which means its an inverted flat and a fake.

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Euro Bull Market Daily Chart Update

Since the beginning of 2017 the Euro has been in a bullish phase, that has been running inversely to the US dollar. I think a correction is completed, which means another 5th leg up in Minuette degree,  should play out. 5th waves are notorious for extending so we don’t want to call an end to it too early.

Once this set of 5 waves in Minute degree has played out, then the Euro could suffer another serious setback (correction) but the final 5 waves up in Minor degree should still happen.

The commercials are net short already which is the smart money.  The non-commercials or speculators, is the dumb money, which is the group that the mainstream analysts always talk about.   The speculators are the ones that always chase the trend as the commercials never do chase the trend, as they do the opposite. When the commercial traders are overwhelming net short then the bull market in the Euro will come to an end.

Right now the speculators are chasing this Euro bull market and they have about a net 2:1 long Euro positions. What they call smart money is already painting themselves into a corner, as they build themselves into a bull trap.

This will not happen instantly as it takes a long time for these net long positions to develop.

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US Dollar Intraday Rally Update.

The carnage in the stock market seems to have done little to the US dollar as it just kept right on its bullish path since early February.

The US dollar rally is a bearish rally, which could still fill a wave 4 rally a bit more, to match the wave two rally that this 4th wave is part of.

Everybody on the planet has to hate the US dollar before its bearish phase will come to an end. In the long run the US dollar decline could end at a wave 1 bottom in Minor degree after which another US dollar freefall trend should happen. It would be great if this US dollar rally were to finish later this week, but that is a best guess scenario at this time.

The commercial traders are net long the US dollar, but not by any extreme ratio, so they still have very little power behind them.c

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US Dollar Daily Chart Bear Market Update

The US dollar has been in a bearish phase for over a year now. Calling it a bearish phase may not be right as that would suggest that the US dollar is still in a bull market.  If the entire US dollar bull market (2008-2016) was a big bear market rally then the US dollar has a very good chance of being “completely” retraced. This would mean that the 70 price target would eventually get hit again. Even lower would not hurt any longer term wave counts I presently have.

The problem is the US dollar will never go down in a straight line, and we wouldn’t want it to. It will give all the wave analyst a real hard time, and rightly so as they think creating a bunch of simple “ABC” patterns is wave counting. The EWP has turned into a mindless trade setup tool which any student can produce after a year or so. Any kid with a ruler can show you a trend line which is one of the most abuse   technical indicators used today.

I love working on the big waves and have worked on the US wave count for close to 20 years. Sure, I got many things wrong, but I’m a tenacious kind a guy and don’t give up that easily.

When the US dollar was still pointing up, I was forecasting for it to hit the 89 price level, where it sits today. We could still be in a Minuette degree 4th wave that still has to play out, but then we could be faced with a wave 2 counter rally. This wave 2 counter rally  could be a fast and furious surprise move that the majority of US dollar analysts will not see.

In late 2016 the planet was bullish on the US dollar as all the experts had very bullish US dollar wave counts. Even now the US dollar commercial traders are increasing their net long USD positions, which still would need to increase by a large margin. The commercials in the Euro and our Canadian dollar are all in net short positions, so this could present some problems at one point in time.

The majority of analysts tells us what the speculators as doing, which is called managed money. The speculators are always the trend chasers, which always gets them into a trap.  A little more sideways or up,  US dollar price action would round off our present rally much better, as the US dollar should still fall below 87. At the 87 price level,  the US dollar is coming up to the bullish trend line, that could give the US dollar some stiff resistance in the short term.

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US Dollar Intraday Crash Update

Trump Expresses Support For Strong U.S. Dollar 2018.01.25 (en)

Trump Supports the US Dollar are the recent reasons why the US dollar has rallied. Does that mean the US dollar crash is going to stop and miraculously turn into a bull market?  No, not on this planet! The only way that a true bull market can form is if the US dollar has completed an “ABC” crash already. The US dollar was due to rally already and the only question is how high?

The US dollar doesn’t even have to go very high as it can go sideways for weeks, before another leg down might happen. There is a very good chance that another 4th wave bullish phase is in progress in Minuette degree.  We need this impending wave 3-4 rally to play out and then we may be getting close to a potential wave 1 in Minor degree.

Presidents can try and jawbone the US dollar up, but debt holders like China and Russia can throw a monkey wrench into that plan anytime they want.  I think we still may have 3-5 weeks left, before we can expect a Minor degree wave 2 counter rally. The US dollar is just a bit below the Fibonacci number of 89 where it can build a base, with many very short 5th waves.

In Greenspand days analysts watched the size of his suitcase to try and figure out how much paper work was in it about a rate change. Next month we will get a new Fed and even then, can a single man turn 100’s of trillion dollars of declining value to increase in value?

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