Euro Weekly Chart Review

The Euro took a dip during the night further confirming a bearish mindset. I’m not exactly happy with this wave count as there is a bit of conflict here as the COT reports still have commercials being net long. Any big changes in COT positions are not posted yet. It takes the Saturday to look it all over for any changes. The USD acted bullish at the same time and gold pushed to $1320 before it backed off.

This short term Euro plunge could lead into a long spike which increases the chances a longer reversal is comming.

During the 2018 bearish phase, the Euro was extremely choppy which are classic diagonal wave structures, and they are still acting that way.

The golden cross is still in effect but that may not last too much longer after the 200-day MA gets sliced in two.

Brexit woes continue and survival of the Eurozone is also at risk as democratic countries are under constant threat of cyber attacks and debt traps.

Even though the Euro looks very bearish we should be very vigil for an unxepected reversal.

 

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US Dollar Daily Chart Review

From this perspective, I can sure show you a very bearish US dollar pattern as I have a group of overlapping waves that can’t make fit.  With a potential wedge and the right shoulder, the US dollar sure looks bearish. At least in the short term. The right shoulder will not hold if the USD is in a bigger bullish phase.

Tomorrow is also the full moon which can produce some amazing reversals but many turnings also happen closer to the end of a month, so the USD can remain bearish for another couple of weeks.

Commercials support a bearish stance right now, as they are net short by a margin of 10.9:1. Of course, the speculators have been chasing the US dollar bullish phase but their net long ratio would shrink as the US dollar declines some more.

A price drops down to the 94 price level would be one of my choices which would trash the bottom support line as well.

In the short term I’m bearish but longer term the US dollar could be in a bigger bull market that very few of us are expecting.  In 2008 the entire planet hated the US dollar, but yet look what happened! The US dollar soared while gold crashed a couple of hundred dollars. The USD has a 26-year falling wedge which can produce super bullish phases.

 

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Euro Intraday Downside Breakout Review

Has the Euro rally gone far enough? Just like the USD, we are dealing with a potential expanded pattern, except the trend is going the opposite way. Even though commercials are net long, they are not net long by very much just yet. This bearish phase is not starting to hit major COT resistance.

In some respect my wave counts are playing, “Chicken” with the COT reports and it’s just a matter time to see who blinks first!

The 4th wave rally in Minor degree ended at the top left of this chart and a full set of 5 waves in Minute degree still have to play out. Even though the decline looks stunted, it can extend dramatically when we least expect it.  Any move below the 1.120 price level will certainly confirm that this present rally is still a bear market rally.

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US Dollar Intraday Bull Market Update.

Some investors are looking for the US dollar to imploded due to the massive printing program they have done over the decades. Back in 2008, this bearish mania was at its record low from its 1985 peak. We were all warned over and over to get into gold and out of the US dollar, yet what happened was the exact opposite. Back in 2008 the USD exploded and has been in a bull market ever since.

This intraday chart is just a very small time period of this bull market, part of a 5 wave run in Minor degree. The 4th wave sure looks like it ended in January as the second low was a higher corrective low. The late January crash has been retraced, and at this time the USD sure seems like it wants to keep heading higher.

It would be nice to think that another wave 1 peak has completed in Minuette degree, but the commercials are still building bearish positions.

I would be very bearish on the US dollar but usually, any asset class will start to “Act” funny, before it reverses any strong trend, which the US dollar has not created just yet.  The Euro and our CAD have also made some bearish moves which should happen as they act inversely inside the US dollar basket.

I would love to see the US dollar break above the 97.711 price level as that would establish a new 2019 record high.

 

At this time the commercials have a net short ratio of 7.29:1 which is on the extreme side. I’ve seen worse so this can keep going for many weeks.  The speculators removed 1659 contracts of their long positions which means they got scared. Another way of looking at this is that my bullish wave count is playing “Chicken” with the commercials at this time. One thing that has not happened as well, is a strong vertical spike in the daily, weekly or monthly charts.

On the daily chart, the USD has found support at the 200-day MA and is still under the influence of a Golden Cross.

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British Pound 1985-2019 Review

 

If we look back to 1985 there should be no doubt that we can see that the British Pound had a huge single spike to the downside. 1985 was an important year for many of the currencies to make major turnings. All the currencies inside the USD index act inversely, so our wave counts have to do the same thing.  Thinking upside down with the wave principle has to be pretty normal if we want a decent wave count.  The last thing I have is a decent GBP wave count.  What I want and what the market is going to give me are two different things. If the GBP gets close to the 1985 bottom will it be at a Cycle degree wave 5 bottom?  I have my doubts at this time as the 2009 bottom may be the “A” wave in Primary degree location as well.

If a new low is going to happen then a plunging zigzag could be in progress. Below the commercials have been switching to the bullish side, while the speculators have done the opposite. Speculators are believing the bearish fundamental news, as they think this bearish trend is going to continue.

All fundamentals come in the form of “news” as the government shutdown clearly demonstrated to me.

 

These visual COT reports give us an idea as shorts and longs are clearly visible. The red lines are the long positions so I would be hesitant to take any position in the short term. Brexit remains the problem and until that gets resolved the GBP could be stuck in no man’s land for a little while longer.

Last week I still received one more Market Vane sentiment report that ranged between 34%-40% bulls, which are not some readings I can jump up and down about. Now if there were only 14% bulls in the survey, then that would be a different story.  I refuse to give any long drawn out fundamental commentary as 1000’s of other analysts are paid full time to do that. Every time the GBP makes a move analysts will jump in and find you a reason why it moved.

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Euro Monthly Chart Update

 

I’m sure the Eurozone is going to be bogged down with all sorts of fundamental problems which we here or read in the news.  The short version is “I don’t do fundamentals.”  Besides that, I don’t think a single analyst can give me a fundamental reason for each Intermediate degree or higher turning.  Forecasting a price crash to come, we know fundamentals will change, so does technical analysis change the fundamentals?

Just like the USD trend is up, the Euro is going the opposite way. Both these currencies need to travel the opposite way in order for gold to soar like they all say it will. After all gold is in a bull market right?  Since the 2008 peak, the Euro had 6 major bullish phases which all were completely retrace except for our present Euro rally.  Do you know how bullish everyone was on the Euro in 2008, yet the Euro turned and crashed?

2008 was also an important year as oil crashed as well.

Fundamentals are lagging indicators, and they mean little after every analyst on the planet is spouting the same gibberish.

Yes, the commercials are net long with their Euro positions, but they removed 5105 long contracts during the shutdown.  The speculators are bearish and last week they turned bullish as they added 9,229 contracts last week.

 

The COT report is a mixed bag and when there are no real extreme readings then I rely on my trend to give us a clue. I see the trend is still down on this monthly and even weekly charts. The wave 3-4 rally has an expanded pattern in it, which means a complete retracement to a new record low should happen. There are many expanded patterns that develop and to not look for them, will always give us a surprise.

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US Dollar Intraday Double Top!

Before the digital ink even dried from my previous US dollar posting, we just hit a double top this morning to within .003 of a point.  Now we have to wait and see if this is a bullish H&S or a bearish one.  I still have 3 degrees left but we may be close to a wave 4 type of correction.  I may also be jumping the gun here, as just a small spike has developed. This entire bullish phase has been running since the January 10th bottom with the February low being the secondary bottom as a higher low. I believe the US dollar is in a much bigger bull market than most of us expect, but where we are in this bull market is always the task at hand. The US dollar turned very bullish in 2008 and since then has been in a 5 wave run in Primary degree.

The Euro took a hit, as well as the other 5 in the USD basket!

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US Dollar Intraday Crash Update

News of a truce in the shut-down wars, forced a reaction from gold, while the US dollar imploded. The Euro and the CAD also reacted on Friday.  It looks like the US dollar is going to keep heading south, but this could also be just another correction.  We only have about 5 more trading days until the end of January after which the US dollar can add another leg up.  Above all, and to help confirm another bullish leg up, this US dollar chart can’t crash below the January 10th low of about 95.050. Besides a few “flash” type moves the markets have been pretty boring, but with the government ready to publish some economic data in the next few weeks, all hell could break lose.

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My updates are going to be sporadic in the next few weeks and months. I will put up a permanent page posting when I have more information.

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Euro Daily Chart Review

At this time I will keep counting like the January/February 2018 peak is a 4th wave peak. During the last 8-9 months, the EURO pattern produced a choppy pattern that contains an expanded pattern in a 4th wave position.  Since November 2018 the EURO rally was also very choppy which fits a bear market rally very well.  I can’t create a set of clean 5 waves up, so the EURO has the best chance of completely retracing its bearish rally.  All the experts in the world will give you reasons why the EURO goes up and down. I don’t need to regurgitate all the fundamental reasons for the EUROs up and down action because you can’t trade on fundamental reasons that change like the wind.

The bottom trend line would be an early warning that the bearish run is over but we have to keep alternates handy just in case.

 

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Canadian Dollar Weekly Chart Update.

Since the 2011 peak when all the experts were bullish on our Canadian Dollar, it turned and started to crash. Our CAD started a bearish trend that still has not finished. The 2011 peak matched the gold&silver peak as well so when the CAD crashed so did gold stock related asset classes. Since 2011 each counter rally has proven to be a bear market rally as record lows were continuously broken.

Since the 2016 bottom, the experts claim that the CAD is back in a bull market. From the December 2018 low our CAD exploded which really got the CAD bulls all excited again. The thing is no new record lows have been produced which has to happen for the markets to confirm a bear market rally is still in progress.  On this chart, the .68 cent price level would certainly confirm that a bear market rally has taken place.  Since the 2017 peak, the CAD declined in a choppy fashion which fits best as a diagonal set of 5 waves down.

None of the COT reports are of any use until the US government shutdown is resolved and even then we may get a surprise or two with a potential “COT Shock”.  As much as I’m still bearish on the CAD it doesn’t mean it will stop on a dime and head south again.

This sideways move has also produced a Golden Cross but now the  “Death Cross” is clearly visible. The CAD would have to switch back to a Golden Cross in order for the bullish leg to keep going.

 

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US Dollar Weekly Chart Review

Since the 2011 bottom, the USD turned bullish again which also matched the stock market bottoms of 2011. Stocks soared and gold-related assets started a major bear market.  I believe the bull market in the USD has a long way to go, but where we are in this bullish phase is the challenge we face. The COT reports are useless due to the government shutdown but my last readings from Dec, 20th the commercial speculators were very bearish.  This is a very bearish sign for the US dollar but the commercials were also very bearish on, silver, Gold, aluminum, palladium, and platinum.

During the late 2018 peak the US dollar produced a very complex pattern that may have finished on January 10 2019. During this USD decline gold gave us an impressive performance that has many convinced gold is going way above $1400.

The US dollar is on a 5 wave run in Primary degree. Take the Euro and invert it, and it would just about look like the US dollar. Only time will tell if the USD has bottomed but eventually the USD should go well above the 104 price level.

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USD Index From A Bear To A Bull in 23 Years: 1985-2008 Review

 

From the February 1985 peak (164.720) the US dollar index started a meltdown that should have sent gold soaring. By the time the USD hit this peak gold already had crashed. In 1992 the US hit another record bottom that I can only count as a diagonal wave structure. Another fast move up and then down again producing a higher low, which is a sign of a bullish move still to come. This move had 5 waves in it alright, but only in Minor degree. The entire USD bullish move was coming to an end and the gold price was crushed at $252 in August of 1999!

From this 2001 US dollar peak, the bearish move resumed, driving the gold price and the oil price with it. By March 2008 the US Dollar was coming to a major bottom that many of the good contrarians of the day saw coming. The 2008 bottom was a Cycle degree wave 4 low. It was not some little bottom in an on-going bear market. Everybody on the planet hated the US dollar at that time, and a panic into gold started to pick up speed.

It was oil that crashed in 2008, 3 years before gold. Since the 2008 bottom, I counted the US dollar as a bear market rally which proved futile forcing a review looking for a much bigger bullish move.

The big top declining trend line has now been broken also signaling a bigger bullish move still to come. Another indicator that a huge US dollar bull market is still in progress is that falling wedge we see.  For most of 2018 the trade war rhetoric has been flying all around the world and yet the US dollar was in a rally the entire time.

Now that the Fed has given the green light, investors jumped back into the stock markets again. Shouldn’t the US dollar keep soaring if trade war peace is being declared at the G20 meeting? With tensions around the trade issue being reduced there would be no need to hold gold as a hedge. Commercial traders are already net short by a wide margin and it will be interesting to see if they close off their short positions with this Fridays COT report.

Longer term the US dollar looks like a run of 5 waves in Primary degree is in effect, and the 89 price level is the start of the 5th wave in Intermediate degree.

Understanding the US dollar bull market is critical as this is not a short-term bullish blip on the charts, not by a long shot. Recently the US dollar has made some moves that could still be bearish which may support the gold price this week.

There are three main prices that should get retraced and the first near-term price target is 103.800. The 121 price level is next which could take a few years before it gets hit!

The real threat is deflation, which has more to do with demographics or the world birthrate crash than a good stock market.

 

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US Dollar Daily Chart Bullish Update

 

One of the reasons why gold is not really soaring in price is because the US dollar is in a bull market, and not in a bear market rally. Sure, we will see the US dollar tumble, but that will happen during a bigger degree of a correction. The US dollar started getting a bit more choppy recently which can mean a correction is still in progress. The US dollar can still take another dip to the downside before it resumes its bullish trend.

Waiting for the US dollar to turn into an extended bear market is not going to happen at this time, even though commercial hedgers are in net short positions already. The commercial traders do not confirm bullish COT positions in gold or silver, so I’m pretty confident gold and silver will still act rather subdued in the near term.

Longer-term, the US dollar will soar above the 103.820 price level which would be another all-time record high since the major 2008 bottom. Wishing for a 2001-2008 like US dollar decline is just wishful thinking because there is no room on the charts for that to happen. The Euro is inverse to the US dollar and I’m sure it’s not going to jump out of the USD basket today or tomorrow. This trade war thing started well before President Trump got into power, so you can’t blame all market woes on President Trump. The massive debt bubble that China is creating has been bursting which makes the US dollar the go-to currency of the world.

Have you noticed how fast GM shut down production in Canada and the USA? It’s more a snub towards President Trump as I’m sure any plants outside the US or Canada will be the last to shut down.

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US Dollar Intraday Bull Market Update.

 

When I see this US dollar chart, it sure looks like a bullish move to me.  Even with all the Trump rhetoric, the US dollar is taking it in stride. I’m starting to push my degree levels to the point I may run out.  When that happens then a bigger review will need to be done. The US dollar has demonstrated to me that it remains in a bullish trend, which started way back in 2008!  It may take the rest of the week or longer, but the USD should show us new record highs.

Anything above the 104 price level could be the setup for a major USD reversal. All other currencies inside the US dollar basket should react positively as well. One way to look at it is that we include gold inside this basket, as it acts inverse to the US dollar very well. Demographics is the main driver of the US dollar as very few even look at the generational impact of the aging boomers.

Breaking out over 97.700 would be the first hurdle to cross, but an impending small double top could put up a good fight. Some analysts are saying that 2019 could be very positive for gold and I see no problem with that, but I would like to see my wave count of wave 3 in Primary degree start to arrive first.

 

 

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US Dollar Intraday Update: Is The Bottom In?

 

This morning the US dollar spiked to the downside and then instantly turned back up. Now we have to see if we keep getting higher lows, as that is one sign of a bullish phase cranking back up.

One thing I like to stress is that the commercial hedgers are net short by a wide margin, but I have also witnessed them make dramatic changes from one week to the next. Besides those commercials are net short in the precious metals which I think could have far more power than one single asset class. Commercial traders don’t have the same agenda as non-commercials do as they work inside or with the people closest to the industry.

Many Gold investors may wish and pray for the US dollar to implode but that is highly unlikely this time. The 2008 low in the US dollar was a.”Major” low that I documented very well. The US dollar also produced a giant falling wedge, about 23 years long. By itself, this type of wedge is extremely bullish, so it’s not just about any single wave count.

I spent years looking at the US dollar as a big bear market rally but every bearish wave count I came up with would never last for very long.

A new record high will help to confirm that the bullish scenario is alive and well!

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FXB: Invesco Currency Shares British Pound Sterling Trust (ETF)

This FXB chart is an ETF that seems to act very well to the regular futures charts I use. There are little differences but not enough to impact major changes from the British Pound futures charts.

The big thing is that this ETF follows as close as possible to the futures charts, not like all those leveraged funds do. It also shows the late 2007 peak which matches the oil peak. Markets started to crash 2007-8 and this ETF crashed right along with the stock markets as well. Gold also imploded as the US dollar exploded in price from 2007 to 2009.

For well over 5 years the FXB went sideways with many rallies and crashes. From 2009 to 2014 that sideways market has been confirmed to be just a big bear market rally as the 2016-2017 crash bottom, completely retracing back to the start of origin, which was the early 2009 bottom.

When some gold experts tell me some forecast where the FXB is going to jump out of the US dollar basket, then they are forgetting the inverse relationship that’s always present

That brings us to our November 16th bottom as I was bullish but it is not responding as bullish as it should, so I have to look at this as a good chance that more downside is still to come.

There is so little price cushion to spare, so any day next week we could see support just melt away!

There could be a new downside to come and it will not be the over or end until a new BP record low is achieved. The way I see it at this time is that the British Pound can land at the same Primary degree “A” wave bottom as all the USA stock indices, silver, Cad, Euro, and gold. I’m sure there are a few more I missed to mention. It’s not about one asset class that may turn, it’s the majority as they are all connected.

In the long run, the BP could be a flat and this bear market is just the zigzag intro. We could get another zigzag bullish phase but once that has been completed, the 5 waves down in Intermediate degree show happen. That’s one thing zigzags and flats have in common they have same 5 waves down their “C” wave slope.

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British Pound Crash Update!

All this looks very bearish as the British Pound futures imploded this morning again. Sure the GBP can still crash and if this is just a bear market rally, then the 2017 bottom will never hold. The commercials do not support the public bearish view as they have very large long positions open with the GBP.

It would be something if the pattern is a 1-2, 1-2, 1-2 wave count. This wave pattern can produce an impulse move that is pretty rare and one more small 1-2 wave structure should appear. 3 sets of 1-2 wave counts after the wave 2 in Intermediate, is about the maximum that we can see, as they will be pretty small after Minuette degree. Either way betting against the commercial hedgers is a futile activity, as it would only give out short-term gains at best.

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US Dollar Intraday Bullish Review!

The US dollar may not be finished just yet, as one more plunge can also still happen. The small open gap is now closed off and a small H&S pattern is also forming. Higher lows is a sign of a bull market, and so far the US dollar index is still creating them. The idea that the US dollar is in a bull market sounds impossible to comprehend by many, but everybody on the planet hated the US dollar in 2008 but yet the US dollar turned and then soared. I spent years counting the US rally as a bear market rally, but my wave counts were trashed many times.

2008 was such an extreme bottom for US dollar which most people are not aware of.  I remember it very well as I had the USD 2008 bottom extremely well documented. 2008 was also the ending of a huge falling wedge, which if they are ignored can produce very violent reversals. We are getting close to a 10-year US dollar bull market where 5 waves up in Primary degree are in effect. Wave 3 in Primary degree would still be in our future as that would represent the increasing “Buying Power” of the US dollar. The Fed action of raising rates is draining liquidity out of the markets which is exactly what raising rates are designed to do in the first place. When markets crash then trillions of dollars will go up in smoke in rapid fashion.

At that rate, money will be destroyed and it would take a 2000 horsepower turbocharged engine driving the printing presses to build it all backup!  When the world is choking on debt then no matter how low rates may go they no longer have the stomach to take on more debt.

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US Dollar Bull Market Correction Update

Since the top of the September in stocks, this US dollar chart has also been on a bullish phase that the contrarians said will never happen. Well this USD bull market just keeps on going, and going  even though the commercials were net short by a large margin. I was pleasantly surprised last week as the commercials added to the bullish side and they removed  some contracts from the bearish side.  The 2008 bottom with the USD was an extreme the likes that only comes along once every 30 years. The USD bull market is only 10 years old, but it sure looks like it’s running a set of 5 waves in Primary degree. Wave 3 in the Primary degree is still ahead of us. Wave 3 peak would coincide with my “A” wave bottom in my Gold wave counts.

This correction could still make some twists and turns as this correction may not be finished today.

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Canadian Dollar Daily Chart Update

 

With COT charts like this, we just look at what is above and below the line and by the looks of it, there seems to be little interest on the commercial hedger’s side to build long positions. I’d rather see extremes first before I turn into a CAD bull and so far we are far from it.

Since the 2017 peak our CAD has been grinding down and all the gold investors need for our Canadian Dollar to soar!  That has not happened, and it even seems like a new record low is still to materialize. From July to about September the CAD was on a rally with some insane overlapping wave structures. Short term Bear market rallies behave just like this and “ALL” bear market rallies retrace themselves sooner or later. This small bear market rally will be retracted when the CAD hits below that .75 price level.

What the public calls a bull or bear market is not even close to what I use as we can get a 61% correction in a wave 2, and get a 40% decline for a 4th wave bottom. I’m sure nobody called the end to the CAD bear market rally in 2017, but we know the majority were all very bullish. Since the 2017 peak two support price levels are retraced and now we are going to face the 3rd one in a few weeks or so.

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Euro Daily Chart: Death Cross Review!

 

This is the Euro daily chart which had its last major peak February, 16th, 2018 at the 1.22 price level. Since then the Euro is showing its bearish side as the Euro slides and creates a Death Cross as well. A Death Cross is about as bearish of a situation that we can run into, but most analysts ignore them.

On the weekly chart settings, the Euro is sitting close to the 200-day MA and has dropped below it a bit.

I’m sure analysts will not be screaming, “20%”, bear market territory anytime soon, because the Euro bear market started back in 2008, about 10 years ago. 2008 was also the oil bubble peak!

Any Euro wave count is basically an inverted version of the USD, and early this morning Euro support crumbled sending the Euro to a new bearish low. I will be the last guy to tell you where support is because you also have to ask support for what? Is the Euro going to pull off a miracle turning on some bullish news flash? News can give us short-term moves, but it takes much more than just some fundamental news report to turn a trend.

Trying to stop a trend with a news release is like trying to stop a semi truck by jumping in front of it with a big flash card! The COT report below shows little interest in building long positions on the commercial hedger’s side. The 1.03 price level can give us support, but that may just be the 4th wave support which I’m looking for.

Remember, all those gold bull investors foaming at the mouth? They need the Euro to sail north, not south like it has been doing.

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US Dollar Scores Another Bull Market High!

 

The last post I showed that the US dollar was in a correction. This has now been confirmed with the US dollar completely retracing the zigzag and pushing to a new high. I’ve made some wave position adjustments with wave 1 in Minor degree already being completed, and another 1-2, 1-2,  impulse type waves could be in play. Tonight the US dollar has gone vertical, even leaving a small open gap in its wake.

There can be a fast correction by closing the gap and then resuming its bullish trend. The intraday price action is not acting like a bear would as we keep getting higher lows and higher highs as well. This price action came with the commercials already having large net short positions in the US dollar, and to make matters worse, they added long positions last week. Even the commercial hedgers turned bearish on silver, gold, platinum, and palladium last week as their short bets also increased.

The Euro and our CAD also reacted by going down, so all this does not support a gold bull market anytime soon.

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British Pound Weekly Chart Bullish Update

 

When markets go down, bearish fundamental stories come out. I look at it from a contrary perspective and when I read bearish stories on the British Pound, I quickly flip to the COT reports to see if the COT report supports any of the bearish rhetoric. Take a quick look below and as the commercial traders see a rosy picture, while the speculators follow the crowd and believe the bearish BS!  In early 2017 the British Pound hit a major bottom and has since been holding. It sure looks like a wave 2 correction has completed, with the next wave 1-2 also completed.

This is also where I use the 1-2 wave count and since I’m at an Intermediate degree bottom, I can only have 2 lower degree extensions. It might be a bit early for Minor degree wave 1-2 to be completed, but that can be easily adjusted.  I’m sure some diagonal wave structures will be thrown in to keep us guessing, but when this bullish phase does something different, it will force a review each and every time.

 

This is the simple British Pind COT report where  the commercials sure are looking bullish to me. Those are net long positions, while the speculators are bearish. Speculators are chasing the perceived trend and always get into a trap. Look into the past and we can see major shifts in positions and I would not look for a bearish wave count until the commercials start to turn net short again, or at least close to it. Are the COT reports classified as “Fundamentals”?  With the EWP, all sentiment readings are important as they make charts go up and down.

The mainstream media always quote the speculators like they are the experts, but the commercial hedgers are a different group, as they deal more with people closest to the industry.

To help confirm this bullish trend, then higher highs, and higher lows must form.

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US Dollar Daily Chart Bullish Update!

 

This US dollar index has just pushed to a new record high this morning! This is not what the Gold experts want, as a rising dollar is not good for gold which has now responded with a price crash of $38! My Market Vane Report shows that about 74% of the traders are in a bullish mood. This is pretty decent but this not at a wild extreme just yet.  Even the commercial hedgers were net long with last Friday’s report, but they can switch just as fast.

I think the US dollar is in a bigger bull market than we can all imagine at this time.  At this time I’m counting the entire US bullish move that started in 2008, as a single diagonal wave structure, which allows for overlapping wave structures. As the US dollar poke higher, we can check the Euro and see that it is plunging. There are a few other currencies that travel inversely to the US dollar and our CAD is also on that list of 6 currencies.  The Australian dollar is not on that list but runs inversely to the US dollar as well.

In order for this rally to be a bear market rally, then 8 months of bullish action must get retraced!  This is not going to happen this year or even a decade from now.  To confirm that the USD is in a bigger bull market than what investors realize, it has to break out and create a  new record high. This high was in December 2016 at the 103.600 price level.

Just eyeballing the weekly charts, we are close to about halfway to this target.

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Euro Weekly Chart Bearish Update

 

When we look at a longer-term weekly Euro chart, I see a bearish trend still bouncing off two parallel trend lines. My main change is that I switched back to making the 2018 peak the 4th wave in Intermediate degree.  The Euro is inside the US dollar basket, and you can’t separate the Euro from the US dollar. The Euro has been “melting” down since the 2008 peak so why should it suddenly stop its bearish trend, and turn and fly north? Many countries under the Euro have serious issues as now they start to blame everyone and anyone for their troubles.

The Euro is just down 1/3 of the wave from the top trend line, which I call “no man’s land”. It may take a few more years, but the Euro should hit a new record low by 2022.

Today is also the 1987 stock market crash anniversary date, 31 years ago.  2008 was a major Cycle degree wave 4 peak, which matched the crude oil top as well. 2008 was also the start of solar cycle #24. There were two solar cycle peaks, in 2011 and a secondary peak in 2014. Each time the Euro repelled to the downside from these solar cycle peaks, but in the next few years, solar cycle #24 is coming to an end! My bet is that the Euro will repel to the upside along with solar cycle #25. Analysts will come up with all sorts of different reasons why the Euro goes up and down.

You read 5 Euro analysts updates, you can find a different fundamental reason as well. For gold investors, they need the Euro to soar, which in turn should crash the US dollar. This is not happening as the US dollar keeps displaying its bullish behavior.

On the smaller scale, the Euro and the US dollar both displayed a Minute degree triangle 4th wave, so that is also an indicator that I must up my degree level by a minimum of 1 degree, but many times there are two-degree level changes that have to be made.

 

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US Dollar Intraday Update

 

This morning the US dollar spike to the downside and then reversed quickly. The Euro did the same thing except the Euro is inverse to the US dollar. Calling for a massive gold bull market just doesn’t fit well if the US dollar is on a bullish reversal. Any sustained bullish move in gold will not happen if the US dollar is in a big bull market that nobody is talking about. Analysts think that the Euro is better than the US dollar when they are bullish on gold, but I don’t see it that way.

The Commercial hedgers are skewed to the bearish side of the US dollar by a wide margin, but the Euro does not confirm it. In a wild move, COT reports can shift very fast, as they can add 10,000 long contracts and at the same time 10-15,000 short contracts get removed.

What many do not understand is that the 2008 bottom of the US dollar was a “major” bear market low, which had its beginnings in 1985! This 23-year bear market was just a correction to an even bigger bull market still in progress.

2008 gave us a Cycle degree 4th wave bottom, which should never get completely retraced. Back in those days, the US dollar bearish mood was relentless and intense. The majority of analysts got fooled by that bottom, just like they were fooled by the Euro peak.

 

 

 

 

 

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Canadian Dollar Weekly Chart Update

 

When any wave positions I have, that do not seem to fit well, then I try and review  any 5 wave sequence I might be working on.  In this case there is still a very good chance that our Cad still has to crash to a new record low, even if it just makes a brief double bottom.  The only way that I can make the 4th wave fit, is that the 5th wave is a diagonal wave structure. An inverted zigzag 4th wave is still the best fit. Commercials have a net long position, but not enough to turn super bullish on our dollar!

Our Canadian dollar has to soar to support a surging gold price, but this is still far away from happening. The AUD has far more commercial net long positions, with a ratio of more than 5:1.

The CAD Market Vane Report (MV) is fairley bullish, with about 47-48% bulls present with Tuesday’s report that leaves lots of room for bulls to come back in.

Even when some COT reports get to an extreme, they can make dramatic shifts, but dumping longs, at the same time they take on short positions can extend any trend.

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Euro Daily Chart Bearish To The Bone?

 

The Euro repelled to the downside after  3-4 attempts at breaking out and is now threatening support. What I see is a potential triangle inside a 4th wave, which is also a warning that a bigger degree bottom is coming. I brought back my  Euro bearish wave counts, and if they are true then that does not bode well for the metals and gold stock ETFs that I cover.  Wishing that Gold will soar, has no hope of happening just yet because the Euro moves inversely to the US dollar.  What all this means, is that the Euro bear market is far from finished, and should hit new bear market lows. That may happen this year, as we have a lot of empty space below the present positions. It’s not completely empty space, as it contains more Euro futures stop-loss sell orders that we can count. It also contains any futures options positions that can expire on any Friday.

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US Dollar Daily Chart: Still Heading North!

 

The recent rally in the US dollar could be just Submiuette degree but it is enough to question any bearish wave counts I was working. At least in the short-term. I looked at last weeks USD COT report, and they are about as bearish as I have ever seen them. 25:1 is what we have right now, while the speculators are doing the exact opposite.

The speculators only have a 6.68:1 net long position, but they are the ones that always get into a trap in one direction or another.  The thing is, the traders in the Euro do not support such a bullish outlook just yet. As I was counting out the Euro at the intraday level, it sure looked like a small triangle has completed. Invert the Euro and we see the same thing with the US dollar.

The US dollar rally will sure keep the lid on gold prices, which may change on a month to month basis.  Even a “Head” is forming, which you will see if we draw an invisible angle line.

Any small correction can still happen but otherwise, I would need a complete set of 5 waves in Minute degree.  The 2008 bottom of the US dollar was a Cycle degree wave 4, so there is no chance the US dollar is on some manipulated path to kill any gold rally. The future threat is not inflation but it’s deflation and this FED rate increase is still fighting inflation.  Even at these elevated price levels, the USD has no room to make a long decline, so that also keeps the US dollar in a long-term bull market. Inflation has nothing to do with how much they print, but it’s all got to do with the “Velocity” of any money in the economy.

It’s the demographic age shift of the “Boomer” generation that will slow down future velocity. Since 2011, 10,000 “boomers” are retiring every single day, which will last until about 2030.  It’s not rocketing science folks as all those boomers will need to cash in their RRSPs and downsize as we become non-productive, leaving the workforce in droves. I’m still very productive, as my little mouse finger does all the heavy lifting. 🙂

I will keep this update short for now, as I may have to make changes, but it may last until the end of this month before, clearer picture forms.

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Euro Weekly Chart Review

 

Since 2008 the Euro has been in a decline or bear market with wild counter-rallies thrown in to keep us all confused, in what the real direction of the Euro is.

The Euro makes up about 57.6% of the US dollar basket, so there is no chance that the Euro will wander in some direction other than inversely to the US dollar. I’m working a  Primary degree diagonal wave 1 with the USD,  but this would be inversed when we look at the Euro. The Euro will not separate itself from gold as the Euro bull market and gold sync up extremely well.

I’m a bit suspicious with my short-term wave positions as we would need a bullish phase to complete wave 2 up in Primary degree. If the bottom has completed, then the Euro should push higher, creating new bullish highs in the process. We have 3 months for this market to give us a clear, “make or break” type of move.

 

 

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