Well, as Spock says, don’t analyse, just look: I looked at a chart from another goldtadise member (Surf City, link in comments section) regarding the USDX and before I expanded it and saw it clearly, I though it was a gold chart from 2011-2013. However it was actually the USDX from 2014-2016! The similarity struck me.

So here are the two charts.  Note as well as similar price action, the price swings are getting longer in time, which is one of Professor Didier Sornette’s favourite features of a post bubble action. A potential USDX target would be around 87 for an initial major downmove to be equivalent to gold’s trip to $1320 in April 2013:

gold bear market fork 2011-2013 like usdx now hands usdx looks like gold 2011-2013 hands

Now, I don’t have time to look at Commitment of Traders or any momentum indicators but I have just posted this as a little provocative idea for anyone to chase up if they see fit.

A couple of further points:

Of course, gold subsequently went to a low of $1180 and then later as far as $1045, so if the USDX were to follow that pattern it might end up in the low 80s. That would not really be a collapse exactly.

Secondly, the timing of this dollar action is a little faster than gold’s equivalent action. Following gold’s chart action from 2011-2016 would not fit in with the normal 8 year up cycles and down-cycles of the US dollar as far as I can see, that would perhaps predict a dollar top in 2016 but then a dollar low in 2023-2024. If gold has already made its low in December 2015, the dollar would make an equivalent low perhaps sometime in 2018. So I am not wedded to this idea; it’s just an idea!

What could cause a sudden down-move in the US dollar? Well, perhaps if we are in the midst of a large upside reversal in commodities and gold, inflation figures could fairly quickly turn up and wrong-foot the Fed as they are glacial in raising interest rates. In my article on Kitco’s marketslant.com, I proposed that a reversal in commodities could add up to 1.6% to the CPI-U inflation rate taking it from 1% to 2.6%, over the Fed’s 2.0% target while interest rates are still well below 1%.

http://www.marketslant.com/articles/has-fed-lost-plot-and-ignited-perfect-storm-gold