Loading ...USD Intermediate Cycle update
My charts show the USD made a bearish breach of it’s Intermediate Cycle Uptrend today, signaling its move into its next IC Low. This is week 15 and the normal timing band for USD IC Lows is 18-24 weeks. That said, the last USD Intermediate Cycle lasted 36 weeks low to low and sometimes long cycles are followed by short ones.
Any bounce should result in a lower high until the IC Low is in. Breaking my Red downtrend line will signal that the IC Low is in and a new Intermediate Cycle has started. My first chart is a close up daily of the past 5 months and my second chart is a Weekly showing the price action over the past two IC’s.
Here are links to my last two posts on the USD for reference:
https://goldtadise.com/?p=378475
https://goldtadise.com/?p=378298
Trend channels are THAT important in cycle work?
Avi, Nothing is 100%, especially on shorter cycles. For the 5-6 Month Intermediate Cycle, however, I find the IC Uptrend line to be extremely telling when a IC has topped and that Price will move into its next IC low within my normal timing bands. Cycles are somewhat similar to EW, in the context that both are reflection of investor sentiment. Five to Six months seems to be about the normal time is takes for investor sentiment to swing from bearish to bullish to bearish again. Here are 3 recent posts that illustrate how my Intermediate Cycle lines work (I do use more TA techniques than just the lines…).
1) Coco (NIB): Note my Blue IC uptrend is breached in mid-May, makes a series of lower Highs and eventually breaks the line with conviction near the end of the 5 month Intermediate Cycle making its IC Low (where most are selling in despair and I am buying).
https://goldtadise.com/?p=378493
2) Soybeans (SOYB): Two charts. First show a similar pattern of an IC Uptrend for 3+ months, a uptrend break followed by a lower high and then Boom a swift move into an IC Low. I sold my longs near the high using other TA indicators, and started building positions near the IC Low.
https://goldtadise.com/?p=378753
3) USD: Focus on the second chart in this post. Note the Blue IC Uptrend 1st broken in Feb 2016, a lower High and then Boom significant move into an IC Low. The only thing tricky about this one was Time as the IC Low took much longer than normal which allowed Gold to rally for much of the first part of the year.
The other thing about Cycles is that it is very important to base your trading strategy based on the status of the Longer Cycle as the Longer Cycles almost always dominate the shorter ones (i.e. If the Longer Cycle is Bullish, the shorter ones should be bullish as well, except at the end of the 5-6 Month Intermediate Cycle where the last Trading Cycle always fails and moves the asset into its next IC Low).
One of the reasons I became convinced that the Gold Bull was going to start again late last year was that I saw the trend change taking place in the USD (i.e. the USD started making lower IC Lows). I was labeled a Dollar Bear but it was what I was seeing in my charts.
The USD has a 5-6 month cycle like everything else but also has a 3 Year and a 15 Year Cycle. My analysis indicates that the USD’s 3 Year Cycle has topped and very likely it’s 15 Year Cycle as well although I am not certain of that yet.
See my 2nd chart in this post and you will note that the USD has broken my 3 year cycle trend line. If the 3 year cycle has topped, then it makes perfect sense that the USD’s Intermediate Cycles should continue to stair step down into its next 3 year Low perhaps in the Spring of 2017.
https://goldtadise.com/?p=378298
I was not belittling it . . . I was curious, and somewhat surprised it played such an important role in the analysis. Thanks for informing me. I do appreciate it.
BTW – I am also looking for a completion to this correction in early to mid 2017. BUT, I am not expecting the DXY to break 90 at this point in time, and may even see one more push up to the 98/99 region first before we hit the 90 region.
Thanks Guys…good discussion
Surf City Forkcycles…still learning here
Here is another example on WTIC Crude and how I used my cycle analysis to swing trade with SCO and UCO.
https://goldtadise.com/?p=378013