Tag Archives: USD

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 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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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 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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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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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 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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US Dollar Daily Chart Bear Market Update

As the US dollar crashes the Euro rallies. It seems the stock market is also ignoring the crashing US dollar, but for how much longer, I’m not sure.  The US dollar has definitely added some extra push in the price of gold, but that can also kill the price of gold when the US dollar decline reverses.

At the very top I have dropped down one degree and temporarily trashed my “D” wave top in Primary degree. It’s not that it’s thrown out completely, it just goes back into inventory for now.  I use 5 of the simple patterns over and over which we can be adapted for any degree that I may be working on. Complex wave structures are just combinations of simple patterns, which can confound us to no end, especially if we don’t know where we are counting from.

I have always mentioned that the US dollar bull market could just be a big bear market rally, which means 100% retracement must eventually happen. In order for any wave 4 top in Intermediate degree to be confirmed we must have 5 waves down in Minor degree.  The difference between a potential “E” wave decline and  5 waves in Minor degree is the 4th wave.  Any “ABC” decline  can look just like a “1,2,3” decline for most of the time, until wave “C” or wave “3” has ended.

We still have time left before we get close to a wave 1 in Minor degree, because a 5th wave can extend dramatically. The commercials are still net short but that would have to change to a net long position once we get closer to any wave 1 in Minor degree.

95 was the previous 4th wave of one lesser degree, so any US dollar Minor degree wave 2 rally can charge back up into this price range. We still have 2 sets of 4th waves that need to play out, so until that happens, there is no sense in turning bullish on the US dollar too early.

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US Dollar Intraday Crash Update

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

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

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

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US Dollar Intraday Price Action Review

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

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

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

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

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Quick US Dollar Update

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

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

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

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December, 1, 2017 US Dollar Bear Market Rally Update

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

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

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

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

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US Dollar Intraday Decline Update

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

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

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

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US Dollar Intraday Crash Update

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

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

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

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US Dollar Intraday Review

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

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

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

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

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US Dollar 2000-2017 Elliott Wave Count Review

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

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

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

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

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

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

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

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

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

 

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

 

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US Dollar Intraday Rally Update

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

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

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

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

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US Dollar Intraday Bear Market Update

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

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

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

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

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US Dollar Daily Chart Bear Market Review

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

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

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

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

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

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US Dollar Intraday Bullish Phase Record High.

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

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

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

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

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US Dollar Bullish Phase Review

 

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

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

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

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September, 1, 2017 US Dollar Intraday Bullish Review

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

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

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

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

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US Dollar Intraday Bullish Phase Review

In August, the US dollar started coming back from a near death experience. It is another example of a very choppy rally that is just a bearish rally as a potential inverted flat. Of course that all depends on where we count from.  This does not mean that the US dollar is going to stop on a dime and then reverse, but it could still need to frustrate us for a few more days. 

When the big picture is foggy, then trying to identify the small wave counts is important, so we know what we think we have. The leading zigzag followed by a small expanded flat and then 5 waves down, now followed by a 5 wave move, that may need a bit more time to complete.

Any US dollar rally will excite the stock bulls, as they are all wishing for the US dollar to start on another major leg up. This is not going to happen until everybody hates the US dollar. Many indicators would have to fall into place before a major US dollar bottom will arrive.  A little bump in the night like we are witnessing just doesn’t cut it, besides stocks would have to play very nice and also confirm the US dollars bullish phase.

Stocks are pushing higher already, but they are all in a choppy rally as well.  We are coming up to some triple tops so they may offer some stiff resistance in the short term. If the US dollar is more bullish than I think then the 95.100 price level would be the next place that the US dollar could find stiff resistance. 

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US Dollar Intraday Review

On the 18th the US dollar created a little zigzag bounce, but by the time they reported the bullish move, it was already pointing down.  I don’t think there are short term surprises, where the US dollar can still charge up to the very top trend line.  

Short term the US dollar still has to head to that 92 price level, as by then we will be forming another H&S type setup. We can get a good bounce from there, but H&S patterns are also good down side breakout setups. 

Last week the COT report showed that the commercials added to their US dollar long positions by a fairly substantial amount. The commercial hedgers are still in a net short position, and I don’t think we will get a super rally until these same commercials become skewed towards a net long position. 

Short term rallies sure,  but a complete switch back to a bull market is not in the cards just yet. The public would have to be freaking out about how much the US dollar has fallen, and investors would be running into gold. Of course that would be another US dollar bear trap setup, and a strong reversal would be due. 

Many may think that the USD is just in a big bull market correction, but in order for a major correction bottom to appear, we need the majority to spew out bearish downside scenario news reports.   If this situation happens at the 89 or 59 price level is  irrelevant, but the “type” of  bearish pattern we finally end up with is.  We can get one big zigzag, (5-3-5) crashing to a new world record low, but that can still be many months or even years away. 

The US dollar can break out of the two declining trend lines with ease, because most trend lines are a subjective take on things.  Trend lines are very abused, and with diagonal waves the trend lines are hardly effective, but they do serve a purpose to isolate certain sections. 

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US Dollar Intraday Bearish Phase Update.

It looks like the US dollar seems to be resuming its decline. If this is true, then the US dollar will retrace the entire early July rally and break down to new bear market lows.   There is always a chance of the USD just falling short of a new low, then turn and soar past the 96.500 price level again.   Nothing indicates that some super bullish wave will launch a surprise attack on us, as when it does, it can do so when the pattern starts to bunch up. So far no bunching is taking place. 

The commercials are still net short the US dollar by a margin of about 2:1, but when this ratio starts to flip then we should be expecting a big counter rally.  Last week the commercials in gold also added to their long positions, which I see as a positive sign for gold. 

The USD bearish phase will run south until such a time that a totally new bullish phase, pushes the USD to new record highs.  In order for that to happen, the talking heads must all put out bearish fundamentals with a high degree of intensity, before a big reversal is most likely to happen.  The majority has to hate the US dollar like they did back in 2008, then when the consensus is bearish, it will turn and soar the opposite way. 

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US Dollar Intraday Bearish Review

The US dollar is taking another hit as it seems to be charging back down again. This is what I expect to see happen until the media becomes very bearish towards the US dollar. On intraday scales this may be harder to recognize, but it is the intensity of the news that is more important, than what each individual fundamental news story may contain. 

The late June rally looks like an impulse, but it quickly fell apart at the top. That early July top looks like a great ending diagonal, and now it is just a matter of time, but new US dollar lows should still be in our future.

Until all the commercials have switched to net long positions and the speculators do the opposite, no real bottom will happen.  Yes, smaller rallies will help to confuse the situation for those that think that the US dollar is still in a bull market.  

The US dollar bull market ended in late 2016, and this bearish phase is now 6 months old.  Stocks have been declining better than expected, which is reverse to any stock mania conditions we had. Even on the short term US dollar rallies, stocks can rally right along with the US dollar, but we have to be aware that any rally can just be a fake. 

Only time will tell, but short term, we need the US dollar to go much lower.

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US Dollar Intraday Crash Review

The US dollar has crashed since the June 20th peak and has now started another correction. I’m counting the sideways market as a potential triangle, but it could be leading to a diagonal wave 3 of one higher degree.  I would love to see more downside to the US dollar as that will help any gold related assets as well. On a stronger than anticipated counter rally, we might see it bunch up before it moves higher, but that is not what is happening at this time.

I can start this wave count as a small impulse, which usually means a bigger sequence is coming. When the media starts to act like parrots, regurgitating bearish news on how the US dollar is imploding, and ridicules bearish price forecasts are made, then I would expect to see a real strong rally to unfold. Trapping all the US dollar bears in the process. One thing we can count on, is that in any market, participants are oblivious when they are in a bull or bear trap.

Don’t worry the US dollar is not going to implode and fall to zero, as it will soar again once a major stock bull market starts. The 92 price level would be the next major area of concern, but we have a ways to go before that starts to hit the radar screens. The 93 price level also contains a triple bottom, and triple bottoms are always areas to watch in any asset class. 

In the long run, the bearish phase is still on, as it will take a major change in one of my indicators that I track, before it makes a major reversal.  When the commercials become net long, and speculators become net short, then it will be time to initiate another complete review.  I try to review before the markets force it on me. Constantly reviewing is the only way to find better fitting wave counts, which are buried in the past. Creating different wave counts cosmetically will never work, as we have to look deep into the past and make structural changes. 

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US Dollar Intraday Bullish Phase Review

Recently the US dollar has been in a bullish phase. What it sure looks like is that we are in a diagonal, with exact coordinates still unknown. One thing is certain, that once a 4th wave rally exceeds the wave 2 top, the wave count must be thrown out and a reboot initiated. The US dollar could drop, but then another small degree “C” bullish wave can happen.  

A new bear market low should eventually form to help confirm that this US dollar rally is still a bear market rally. Even if we are at a potential 4th wave top, it could all lead into a new wave 1-2.  The resistance line is the maximum I can let this run go too, so it won’t take that long before I have to put this wave count back into storage.  One thing about diagonal 4th waves, is once they dip into the previous wave 2, under no circumstances can it go above the start of wave 2. Diagonal 4th wave rallies have to come to a screeching halt inside wave two, as 4th waves also point to the diagonal wave 1-2 as well. 

There was not that much action last week regarding the net short positions that the commercial traders hold.  When the commercials become net long again, then it is time for a major review of any bearish decline we have. 

Gold has suffered under this US dollar rally, so any decline in the US dollar would be beneficial for gold and silver. 

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