Tag Archives: Elliott Wave US Dollar

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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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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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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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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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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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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US Dollar Intraday Rally End!

 

I’m sure this bull rally would be a concern for gold investors but the shorter term we could be heading to a wave 2 bottom in Primary degree. It’s the US dollar that will drive any gold bullish phase, not a bunch of emotional investors running to a safe haven asset class. This may work short-term but long-term deflation is the real threat, which means that the US dollar bull market is far from over, as I expect 5 waves up in Primary degree, which could take until 2041 to peak out. In 2008 the USD bottomed, so 30 years from 2008 could get us a peak in 2038.

This move may be too early for a wave two peak in Minor degree, so I have reduced the degree level, by one degree.  Gold will benefit from a US dollar decline, but this may only last until late 2019 or early 2020.

Those that ignore the ongoing “Boomer Crisis” and the huge demographic shift, will not understand the deflation that is coming. How much money a nation prints,  has nothing to do with “deflation” or “nflation”, but it all has to do with the “velocity” of any money.

If you think that 10,000 from 80 million + boomers retiring per day is inflationary then, I suggest you research it, as it is a worldwide problem. Boomers that have not moved away from the risk facing them, will lose the majority of their assets if they invest for the long term.

 

 

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US Dollar 1985-2018 Monthly Chart Update

 

I’m sure all the gold investors will be grinning from ear to ear much like the Joker in a Batman movie, as the US dollar keeps declining. What this big chart shows is the huge falling wedge from that 1985 peak, which stopped in 2008 before it blasted in a surprise move. That 2008 rally was no surprise to the contrarians at that time because I documented the turning in great detail, and at that time I also had some futures long contracts out on in, and caught a good part of the move.

From the 2008 bottom  I spent years counting it out as a bear market rally, and switched to a bullish wave count as well.  The idea that a beautiful impulse is still going to happen, will fail as soon as the USD dips into my wave “A”.  It doesn’t even have to get that far as, but if  the USD is in a much bigger bull market then the US dollar will find a major bottom and reverse. The wedge is telling us that a huge bull market still has to form in the US dollar.

The US dollar is heading into a correction that may take it down to that 80 price level before it finds a solid bottom again. Since the Euro makes up about 57% of the US dollar index, it has shown very bullish moves inverse to the US dollar.  When the US dollar does find a new bottom then many of my COT reports and the Market Vane report, will also change to a bullish reversal. I believe the ETF UUP would be a buy once wave 2 in Primary degree sees it’s bottom.

Without a doubt the US dollar will soar above 120 and even beat or double top the 1985 peak at about 165.  This may take until 2041 to happen, so only the younger wave analysts will benifit in the long-term.

 

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US Dollar Weekly Chart

 

The US dollar had been running north but the hedgers, (commercials) have increased their bearish positions on the US dollar. Many COT reports have seen strong reversals of positions, so it’s not just the USD. Long term the US dollar is on a major bull market, but during any USD bull market correction will send the price of gold soaring. I was looking for 5 impulse type waves but the next low could very well dip into what used to be my wave 2 bottom, but now I have to work it as a diagonal wave 1 in Primary degree! Diagonal wave structures are very common in all commodities, which are just zigzags connected together. Small zigzags to very large zigzags is the rule not the exception, as we will find very few flats, except for zigzag corrections.

Flats are pretty rare in commodaties, so knowing  how to count connecting  zigzags is very important.

The 2008 low in the USD, was a 23 year low, from the massive 1985 US dollar peak. (British Pound bottomed the same year) That 1985 peak is a Cycle degree wave 3 peak with 2008 being the 4th wave in Cycle degree.

If the USD still implodes this year, then gold should soar. What will happen with crude oil remains to be seen, as the gold/oil ratio will not stay at 17:1!

It may be hard to understand that the US dollar is in a huge bull market, but that only concerns gold investors, it matters little to traders who can bet in either direction, up or down.

This big US dollar bullish phase is heading up to Supercycle degree wave “a” and may not arrive until 2041. The USD could arrive 3 years earlier as there is a 3 year difference between the USD and gold.

For years I counted the USD as a big bear market rally but it sure fought my wave counts every steep of the way.

 

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US Dollar Daily Chart Bull Market Update

 

The US dollar refuses to die and that is because it’s in a huge bull market which only a few market observers understand. I have been mapping this huge bull market to memory first as we have to “see” the pattern first before we can count it out! Wave counting is a secondary act of confirming what we think we are seeing.

This bullish phase can still last all year, but I do expect a violent US dollar crash to happen during 2019 and even last until early 2020. (March) This would happen when the US dollar corrects for a Primary degree 4th wave crash after which we will see a bullish phase in the US dollar that will shock us all. It sure will be a surprise for gold investors as they will get burned in the process. The US dollar bottomed in 2008 as a 4th wave Cycle degree bottom ending with a zigzag. Oil peaked with the US dollar bottom, which seems to be 3 years apart from when gold peaked.

“All” commodities are linked together with zigzags in a diagonal world and where the EWP rules are constantly being broken. It is impossible to make sense with commodities, if we can’t count inverted zigzags lasting over 40 years. Gold bugs have a real problem with a big US dollar bull market as the gold price will get crushed during the next 3 years. This year or in September, gold will break below $1047 and even end up crashing down between $700-$800.

No matter how bullish the US dollar is very long term, it is during it’s corrections that gold and gold stock ETFs will soar. From a traders point of view it matters little as we have the freedom to bet down or up when the time comes. I’m very bearish on all gold stock related ETFs and have no intention of closing off my bearish positions. I have added options to the mix and they have to get closed off a week or so before their expiration date turns them worthless!

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US Dollar Daily Chart Update!

 

During July and August the US dollar started to go sideways before it started another correction. There can always be a bit of downside to go, but a higher low seems to already  happened.  Since we have two spikes to draw a H&S line across, we see that this can be very bearish for the longer term.  If the US dollar is in a much bigger bull market, then any H&S reaction will blow the lid off the right sided shoulder.  When the US dollar breaks out it will help to confirm that the US dollar is far more bullish than we can imagine at this time.

A bull market in the US dollar is “deflation”, as it will also kill the price of gold. The $1200 gold price is a psychological even number, so when this $1200 no longer holds, then this will really upset the gold bulls. Without a doubt the US dollar will break out to new record highs, as the Euro implodes again. One main USD price high to beat is 107 or higher and then 122 will be another price peak that eventually gets hit as well. The first major breakout could happen by the end of this year, but that is still 4 months away.

Yes, the commercials are building up net short positions in the US dollar, but they can handle extremes as they are the closest to the industry and have far less risk that any of the hedge funds have. (speculators). Even my Market Vane report showed a high perentage of US dollar bulls present, which suggest that the US dollar could still implode.

Once the US dollar resumes its bullish trend, then the Euro will carry on with it’s bearish trend. Again, gold investors need for the Euro and our CAD to keep going up, as the CAD and the Euro are inside the US dollar basket.

The Euro will travel in the opposite direction than the US dollar, so wishing and praying for the Euro to soar is very unrealistic at this time.

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US Dollar Weekly Chart: Bull Market Or Bear Market Rally?

 

Some of the COT numbers for the US dollar have already been shifting as the commercial traders start to pile on short positions agains the US dollar. We also had a US dollar death cross, but during 2008-2011 we had many crossing. Another rally would turn the Death Cross back to a Golden Cross very fast.

Early 2018 the USD came to a screaching halt at 89 after which it started to crank up, push the price of gold downward. in the process. For those that are convinced that the US dollar will implode due to over printing, will be right at one point. The five waves down, since 2016 did send the gold price soaring, but the gold price refused to push higher after.

From about 1992, all the way up and then back down to early 2008 is just a correction in a US dollar bull market that very few understand.

A bear market is just a correction to a bigger bull market, and eventually this US dollar chart has to retrace the entire bear market, and travel above 2016 and 2001 highs as well.

Any bull market with the US dollar is deflation!  In 2011 the US dollar exploded, along with stocks and gold stocks took a major beating. This is a classic description of a stock mania that has happened many times before.

I know EWI has a very bullish US dollar wave count and I switched back and forth a few times myself. Any trend doesn’t just quit on some news as you can’t stop a trend before it’s time! The 2008 bottom was a prime example how bearish the entire world was towards the US dollar. Yet in face of all the overwhelming bearish news, the US dollar started to rally which still isn’t over.

Fundamentals will always tell us the wrong things at the extremes, as late 2007 was about as extreme as I ever recorded. Even my Market Vane (MV) report from Tuesday, has about 74% bulls present which is on the high range alright, but this extreme could also reach 96% or 98% before the US dollar implodes. Lumber had 98% bulls present, which is the most extreme I have ever seen. With the silver mania bubble peak in 2011, the MV extreme reach 96%. With those kind of odds, markets have no choice but to reverse.

 

 

 

 

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US Dollar: Weekly Chart Golden Cross Review

Since so many things correlate to Intermediate degree 4th waves, I decided to keep my old wave count going. My Cycle degree 4th wave bottom in the US dollar stays after which it explodeded while stocks, gold, silver investments crashed. The entire planet was bearish on the USD back in 2008, but yet it turned and soared ignoring all fundamentals at that time. US dollar bear experts dropped like flies as their forecasts were all proven wrong.

I don’t escpecially like some of the positions but I sure think we are dealing with an expanded flat in Intermediate degree. An expanded flat always means a new record high will come. This new record would be above 104 on this futures chart. The next bull market peak to break will be 122, with the biggest price to retrace being 165!

On the monthly and daily charts, the Golden Cross has already happened, it is this weekly chart that needs another Golden Cross to happen. Three golden crosses on the US dollar sure looks like a bull market to me! Five waves up in Primary degree is what we need to complete wave 5 in Cycle degree. I will be making adjustments  along the way but the US dollar bull market has been unleashed, which will produce a deflationary crash that no one alive today has ever experienced.

Deflation is in our future, not some imaginary runaway inflation that the gold bulls must have to be right. It has nothing to do with printing money folks, it’s all about the velocity of any money in the economy at any given time. Ignoring the world fertility crash is a big mistake as billions of older generations will be gone by 2050 and retired people are frugal. When markets crash, couples stop having babies as uncertainty grows, so after a market crash, fertility rates crash as well.

As the US dollar keeps turning up, then this will drag the 50-day MA up into the 200-day MA and then all three time periods will have completed golden crosses.

That’s about as bullish for the USD as any simple technical indicator could ever tell us.

On the monthly chart I also have a huge falling wedge which is another very bullish indicator that I use. This bull market could keep going for the rest of the year but then be ready for a big USD crash that will send the gold price soaring again. There are those that see it coming, and then there is always the majority that will never see any crash coming.

 

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US Dollar Big Picture Review: Inflation Or Deflation?

The top chart is work in progress. I work out my wave positions from memory in the shape of pictures, then I try to confirm it (offline) by working on my paper print out wave positions. With difficult wave positions, I always work from paper as the rest of the world has their heads stuck in their computers or cellphones. If you were to test the wavers on the entire internet, I bet not a single expert waver can produce the same wave count offline and on paper in front of my eyes!

I have some huge important gaps in the USD wave positions but I’m very confindent, that the USD is in a much bigger bull market than any expert on this planet can presently imagine. The gold bugs are escpecially wrong if the the dollar remains bullish until 2101. (Submillennium Degree wave 3) GSC degree wave 3 would end about 2071.

It’s between major peaks of the USD and its corrections,  that will produce wild gold bullish phases that will blow your mind.

Folks, there is a time when to invest in gold and there is a time when to “SELL” gold. Holding gold at the 2011 peak is the worst mistake that investors make as 2011 was a 30 year gold cycle mania peak. Not some correction in an ongoing bull market where they expect $5000 gold. This is not going to happen as gold will hit  below $500 long before gold $5000. They got their zeros wrong!  I was always scratching my head how the goldbulls can expect a super bull market, in gold when the USD has so little room to implode.

The 2018 low in the USD (89) was a critical clue in all this which turned my USD bearish sentiments into USD bullish sentiments. My 5 waves down I thought counted out great to the degree, but then when it took off, very bullish patterns started and I had to switch to a big bull market instantly. We can’t be asleep at the switch, as every major turning  requires us to switch 180%.

I made up two of these but with the bigger trend lines that I see. Just the big wedge alone, for this length of time suggests a huge USD bull market is coming, which is deflationary to say the least. The USD has turned into a safe-haven currency and I for one switched to USD trading as fast as I could, and I have no regreats in doing so.

What do you think we will find if we hunt for a Golden Cross in the US dollar? On daily charts this has already happened so we have to use the Golden Crossings in a bull market. The rest of the world is sitting on Death Crosses, while the USD has just finished a Golden Cross in the daily charts. Sooner or later the USD should see a new record high, which will shock the gold investor, in how could this happen?

I just want readers to know that even though my wave counts are iffy at this point, I’m always working on the bigger picture. I’ve been at this for over 20 years trying to solve the USD Anigma code and I will not give up until I die.  It is the world birthrate crash that is doing it, that all forecasters are ignoring. I have relatives that are going to get very hurt in the next 3 years, as they are all “invested” in real-estate!  I’m a trader where cash flow is king, and nothing else matters. USD Capital preservation is going to be the key, as all other currencies are going to get crushed!  I have to make a living from my wave positions, and I would be wiped out pretty quick if I can’t make a 180 degree turning when I need to.

I have recently told my client in what I see in gold, and he has no problem with it, even though he has a good gold silver stash for his son and grandson.

In the next few years we will see how financial advisors that got you into gold acually know where they are. How many of them will call up their clints and say, “I think that gold is going to crash, and we should cash out now!”

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US Dollar Weekly Chart Bullish Update!

I tried these wave positions several times in the past but I have to bring it back as the USD could be in a bigger bullish move than anyone even suspects at this time. At the 2018 low I was expecting a wave 2 rally, which even has returned to the previous high where I would expected the wave 2 rally to end. Even the Death Cross on this weekly chart is showing, which is extremely bearish for the US dollar. Don’t get fooled by this Death Cross as they are all lagging indicators. The sequence I’m  looking for in a bull market is GC,DC,GC.

We had the first Golden Cross back in 2012 and look at that wild bullish move that it gave. Our next crossing should be a Death Cross, which has happened. Again they are lagging indicators as this market could turn where the 50 day line would crank up and slice through the 200 day line.  A very short life span of a Death Cross for sure. It may 10 weeks for the next Golden Cross to happen, but when it does it could spew out a major bullish phase surprising all USD watchers.

The Euro is melting down as the rest of the world currencies are in worse shape than the US dollar is. Safe-Haven in the US dollar? Now there is a real fundamental switch. Most analysts haven’t even suspected that this can happen, as the majority is always wrong at the extremes. Gold bugs need for the US dollar to implode, and the Euro and our Canadian dollar to soar, but none of that has materialized, in fact, the very opposite has been happening. The commercial positions are still short the Euro, so this has to reverse if the Euro is still to soar. Our Canadian dollar is heading into the toilet, which does not support any sustained gold rally at all.

For this US dollar bullish move to get confirmed, the US dollar “must” breakout by hitting a new bull market record high. Once it does that, then we could get into some violent US dollar moves. This  will drive gold bugs crazy as the US dollar has a direct or inverse relationship with gold. I’m a contrarian analysts and if I see that gold bugs are acting stupid, I have no guilty feelings, or hangups, in shorting them.  The only obligation I have is to find the best long trade setups for my friends and myself, and warn of major impending reversals and crashes. This happens at the Intermediate and Primary degree levels the most.

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US Dollar Weekly Chart Golden Crosses Update.

 

In early 2018 the US dollar hit the 89 price target but at the exact same time an extension of the trend line was possiable. The US dollar is acting as a safe-haven go to currency which not to many gold investors are aware of.  With the US dollar still being in a bullish funk, two Golden Crosses have already formed. This is the very opposite of our CAD.

The problem is that all Death or Golden Crosses are lagging indicators at best, so I hardley use them. If the US dollar short term crash was just a correction, (Expanded).  Then the USD must prove this out by pushing to a new record high. Even if it only squeaks past the top by the smallest amount, the USD decline must get completley retraced from the point of orgin.

 

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US Dollar Daily Chart Update

Is this Head&Shoulder pattern a bullish or a bearish indicator?  Tecnically speaking we are at a previous high that still could fit a Minor degree rally and we should see a major decline to follow. If we look at this H&S pattern as a bullish sign then what has to happen, is the point on the right shoulder is going to be forced off.  The 89 price level is not just a lucky stop but it’s a Fibonacci number as well. 89 is also where the 2011 bottom meets perfectly with the bullish trend line.

Falling below this 89 price level, the US dollar would have to overcome major resistance to the downside. My bet is that the US dollar is in a much bigger bullish phase than what anyone can envision right now. Actually, the US dollar could be acting like a safe-haven place to hide, from the Euro storm that has been brewing for years.  The US dollar rally is keeping gold prices in check and as long as that scenario stays gold could crash much deeper than expected. Hoping of the return of the US dollar bear is just wishful thinking because this bullish move could last well into the fall. Commercials are net short the USD by a very wide margin and a bull market can keep fighting of the bears  for a very long time.

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US Dollar Intraday Bearish Action Update

The US dollar has been standing up very well recently but and correction has not gone deep enough to make a difference. The rally in the last few days also has been very choppy, so this sure works as still part of the counter rally. I relabeled the top with an “A” wave but this may just be a temporary thing until I eliminate more alternate wave counts.

There still should be a very bullish move coming as the entire USD may still be part of a bigger bullish phase.  The Euro should act inversley to the US dollar, but otherwise I remain bearish on the Euro.

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US Dollar Daily Chart Bullish Phase Update

So far the US dollar is in a bullish phase that has no signs of quiting any time soon. The Euro acts inversley to the US dollar, like our  Canadian dollar and the Austrailian dollar is.

Right now, I think we are in another correction, with gold spiking back up to $1300, and oil also making a good bullish showing today.  If a brand new leg down was to happen then our present run is coming up to resistance. We also have a H&S pattern set-up so if the bearish scenerio is true then this H&S pattern would be a bearish set-up. This could also be a very bullish H&S set-up and if that is true then the US dollar will blow past this resistance price level with little effort.

Any 5 wave move can point to lower lows, but if it was attached to an expanded  “C” wave decline, then the US dollar can see new record highs. This may take all summer and well into the fall to complete so until this happens the bearish forces will still dominate and gold move.

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US Dollar Daily Chart Rocket Bull Market Update

The US Dollar bull run just keeps on going. I hate to call any top at this moment because these types of moves  can extend dramatically. We do have a small vertical spike that seems to be forming, but again we could still be a bit early for a decent correction to take place. Troubles in Italy and the Euro in general, is helping to confirm the EURO bear market and this US dollar bull market.

I believe the US dollar crashed as an expanded wave 4 correction and if that is the case then the US dollar still has to score a new bull market record high.  It still may take the rest of this summer or into the fall before this bullish run starts to get near an end, but it will end. When that top arrives then another big US dollar bearish phase will ensue and gold related assets will enjoy another huge bullish phase. As long as the bullish presure remains in the US dollar, gold and gold stock ETFs will act subdued or very bearish.

In the 2008 crash gold stock ETFs also crashed along with oil and other related assets, so there is no reason why it can’t happen again. For now I started with the Minor degree wave count and it may look a bit small, but moves like this can soar once real extensions start to happen.

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US Dollar Intraday Bullish Phase Update

In late February I was calling for a US dollar counter rally, but as soon as it did charge up, the pattern was very impulsive looking which usally sends markets much higher than anyone expects at this time. The Euro is just inverse to the US dollar, which has been on a decline as well. It’s not just about one asset class as the US dollar bull market and bear market phases sends reverberations across many other asset classes as well.  The US dollar rally has been the reason why gold has been so lethargic. If a correction in this US  dollar bull market is due, then gold could see some bullish moves as well.  One little dip in the US dollar doesn’t turn gold into a massive bull market over night.

All commodaties I track are in a 4th wave in Cycle degree, and most of them are still far from being finished. With about 30 Cycle degree wave 3-4s in play, it may take until 2021 before many of them will be ending their respective 4th waves in Cycle degree. There are only a few asset classes that have seen a 4th wave bottoms, but in a few years time, many more will join the club. All these 4th wave endings will produce 5 wave waves up in Primary degree, but in commadaties, these 5 wave sequences can be extremely choppy as well.

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US Dollar Daily Chart Review

I’m sure the gold bugs will not like the US dollar wave count, but it runs inversely to the Euro and wouldn’t do it’s “own thing” no matter what we think.

For gold to soar, we need the US dollar to implode, but obviously that is not happening at this point. This potential 5 wave run looks identical to the Euro 5 wave decline. I also moved my bearish degree level down by one with this run, but may have to shift back if this pattern does something completely different.

As it sits this US dollar bullish phase is not completed but a correction seems to be in progress. It’s this USD correction that has stopped gold’s decline for now.  This bullish phase could move at a very high speed, but it is developing a pretty good looking impulse which can make it easier to count out.

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US Dollar Bullish Phase Review

When I was working the Euro wave count I saw a very bearish scenario. The USD moves inversely to the Euro which is clearly evident in the chart. There is a very good chance that the US dollar peak was just an expanded correction and that our February low is an Intermediate degree 4th wave bottom.  I was bullish with this turning but as a Minor degree wave 2. Shit, we could see 5 waves up in Minor degree that will shock and awe us all.   Stocks have plunged, but the USD is soaring so that sure does not help gold any.

Right now the USD is at a resistance level, producing a big H&S pattern. There are bullish H&S patterns and there are bearish H&S patterns, so if this bullish phase has much longer to travel, then the line on the left shoulder will get lifted. Yes, I now have 2 open gaps on the way up, but they could remain open for the duration. This little pattern showing a much bigger potential bullish move, is enough to trigger a monthly chart review instantly.

When something in the intraday scale goes amiss then this is a signal to count backwards to find our mistakes. This has implications that wave 3 in Cycle degree could have ended in 2008 along with oil. Our CAD is going the opposite way which had it’s Cycle degree wave 3 peak in late 2007!  With so many Cycle degree peaks completed it feels like this blog is the graveyard  where Cycle degree wave 3 peaks come to die!  😉

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Quick US Dollar Intraday Rocket Ride update

This week we saw the remarkable rise in the US dollar, leaving behind one big gap as it surged closest to the previous peak of a wave 1. The wave 1 peak is the  resting place of the bullish trader as they love to jump on the upside bandwagon.  All this has to eventually wear out, but I’m hesitant to call a top just yet. We could get a quick short free fall, and then instantly resume this bullish trend. We can go much higher in the short term, but a correction is due.  We are on a potential wave 2 rally in Minor degree which will set the tone for the remainder of the bear market.

If the USD crashes in a big 3 wave fashion, then, this could signal that a triangle may be in play, but it would also mean that we are in a “B” wave counter rally in Minor degree which can contain the smaller triangle.

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US Dollar Daily Chart Bullish Phase Update.

It’s obvious that we see the US dollar in a bullish phase. Technically, it would be called a bear market rally if we believe that more downside is still to come.

Otherwise, we just assume that the US dollar bear market is over and the great USD bull market will resume. The horizontal line connects at least 7 points, which can give the US dollar rally reason to pause or even run out of power!  I will be looking for a wave 2 top in Minor degree with the trend line being well within the previous 4th wave of one lesser degree.  Any wave 2 rally is not limited by any means to stop dead at the trend line above as %60-%70 percent rallies can and do take place. In short, the general guideline for previous 4th wave reversal might not mean anything.

Fighting against the bigger trend can take more time than normal, so we have to have patience as I believe that the US dollar still has a huge bear market to show us. This USD rally is keeping a lid on gold and silver prices and it could still force a temporary drop in the price of gold and gold stocks.

The Euro is also crashing, and our CAD seems to want to take a rest from getting beat up.  US Dollar COT reports do not show that both types of traders are in radical positions which gives the US dollar a bit of flexibility how high it can go.

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US Dollar Bullish Spike Review

I’m working this rally as a Minor degree correction, which is not finished just yet, but this USD rally  has more to go, as another wave 3-4 should happen.

We had several gaps open up on the way down, so I was pretty confident that the US dollar still had to rally and close those 2 gaps. Now on the way up, a huge gap open up, which will get closed in the future. We know that the USD will eventually decline again, and close this gap completely.

Gold and silver both took hits as well, while oil soared this morning in a massive bullish move at the intraday scale.  I have full confidence that the US dollar is not going to the moon, but this rally could remain bullish in the shorter term.

I usually do not post on Mondays that much as most of the real action happens during the rest of the week.  The full moon is still about 5 trading sessions away so we will find out with the Sunday session if any reversal may happen.

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