I feel the need for a commodities 2.0 post since one theme here right now seems to be commodities coming crashing down soon and that heavy deflation is at our doorstep at this moment in time. As I think you know by now, I have the opposite opinion and I feel the need for elaborating a bit on this.

My last major posts on the commodities is linked here below. In the post linked first below I talk about that my view is that we are at the beginning of a new 15 year cycle in the commodities plus about that I do not see heavy deflation/post bubble contraction happening yet.
https://goldtadise.com/?p=397688 Commodities 1.0
https://goldtadise.com/?p=391730 $CRB
https://goldtadise.com/?p=400882 $WTIC

I think the very long term holds the key to see where the commodities are going at this point. Might seem obvious to say and also valid for any market but I think it is especially valid for commodities at this point in time I would say. Therefore, I focus on the very big picture in this post. I am also using both TA and cycles as I think you need both at gigantic shifts in the markets which I think we are experiencing right now.
I have used the 15 year commodity cycle on most charts. Sometimes I will use the half 15 year cycle, i.e. a 7-8 year cycle, and sometimes I will use the quarter 15 year cycle, i.e. 3,5-4 year cycle. Also, I see it as the 15 year cycle does not have to be exactly 15 year in order to fit the overall commodity cycle; it can be one to two years longer or shorter also in order for me to accept it as the 15 year commodity cycle.

I have excluded PM, uranium and most currencies here in this post. This because I have covered uranium with a larger post recently and because I have a similar, big picture post for PM coming up, special edition. This post will therefore focus on commodity prices, commodity currencies, SM emerging markets ETF and SM sector ETFs for commodity stocks.
And, this one is going to be a lengthy post in order to be able to put across what I see so please bear with me on this one. Load up with a big coffee maybe as we would do here up in the cold north.
Also, I had almost finished the post and then did some weird move on the keyboard and all was – gone… Therefore the post will be much shorter than intended.

Alright, now, let´s endulge. I thought we´d start with commodity currencies.

Below we have three big commodity currencies vs the US dollar. Without the cycle it would not be easy to tell if the chart is bullish or bearish really. But since they all are at the beginning of a new major cycle, they are very much bullish.

And below we have three commodity currencies together with the commodity each currency has the strongest bond too. If one of the two on each chart moves up, the other will follow.

The ETF for the emerging markets´ currencies is below and it speaks quite well for itself. Many emerging markets are built on commodities. Remember the sentence just above, if one of the two moves up, the other one will follow.

Moving on to commodity prices. Below are three charts with the $CRB. The quarterly is the main one, the other ones just add info. For more on these, look at the middle link at the top. This take on the $CRB chart I think is nowhere else on the planet.

The original 220 year commodity price chart of the one below is borrowed from a report I got from norvast. I have added everything on the chart besides the texts “Lower prices…” and “Higher prices…” plus the almost vertical dotted black lines.

This chart is a mouthful at first glance. First, the purple smaller expanding wedge is my quarterly expanding wedge above. It is sitting right on top a much larger black expanding wedge as a BT pattern. We also have a hand drawn blue parabola going on. The orange is the latest price action since the chart was published in 2013. The green is a new channel. The proportions are monumental as you see but the fact is, this chart is bullish, both with regards to the traditional TA and the cycles.
On this particular chart we seem to have the 30 year cycle norvast have talked about. I still think though that the 15 year cycle is much more clear looking at all other charts. The 30 year on this chart can of course also be broken down into two 15 year cycles, and the 60 year cycle into 30, 15, 7,5 and 3,75 year cycles.

Moving on to oil, $WTIC. I have posted these charts before. Now though we have an expanding wedge (purple) as a BT to the massive inverse h&s on the weekly. And take a long look at the cycles on both charts. And it is the same here I would think that nowhere on the planet can you find these charts of $WTIC but here.

For the rest of the commodity price charts I will not comment each chart individually but just line them up here below.




Next we move on to commodity stocks. Below we have the ETF for the SM emerging markets, EEM. Here we have a move in the making that I have posted on before.

And below we have the sector ETFs/indexes for commodity stocks, all lined up. Bullish looking orgie really.

So, in sum, I think that commodities in general has entered a new 15 year bull cycle. Have a look once more at the light grey cycles on the charts above, they are talking to us. And, the fact is that, most of the charts above are pioneering and will not be found anywhere else I would think.

As I have said all along, I do not think that the credit/debt/QE cycle is over yet, and therefore we are not in for heavy deflation yet. We have yet a couple more years of asset inflation ahead as I see it. It is quite easy to see on my many price charts above that the commodity prices are going up going forward, i.e. the charts would not look like this if we had big deflation looming as I see it. What I think is that the pop of the then even more gigantic credit/debt/QE bubble will coincide with a parabolic top for that 220 year chart above.

One reason why we have a carnage stamp on commodities here now is, I think, because there is too much focus on only oil. We can´t look at just one commodity chart and say that, yes, we are looking at heavy deflation. Also, oil is a huge part of most of the commodity indexes so if that one flimses around a bit, the commodity indicies will flimse around too. So, let´s look for a sound balance when we look at the commodities, and if we do that; I say, as I have said for quite a while now, that commodities is in a new bull market. And by the way, oil is looking good, as I see it.

Could we have a small or large black swan event..? Yes, of course, that is always a possibility and then all bets are off I would think, at least for a while. But until then, the charts above are pretty clear to me.

The essence of what I think on this is that we most probably are at a time in history which is totally out of this world. If you have another look at my charts above plus the 220 year ditto, then it is clear to me that we are at the very doorstep of the most vicious commodity advance the planet has seen for at least 220 years. We are all simply a bunch of lucky bastards really. The ones of us that can see it coming that is, and act on it. Have yet another look at that 220 year chart above with my blue parabola line. I think that parabola is very, very real.

The backside of that 220 year commodity price chart is that quite a long period of downturns, nonexistent growth and recessions are waiting after that parabolic top, it would seem. So let´s make the most of this coming gigantic move which has already started. We are looking at the commodity opportunity of the last two centuries it looks like, and top that up with that the whole planet is using FIAT currency at the end of an overdue monetary system cycle, plus that the world´s reserve currency will go down the drain. That is a pretty good scenario for a final commodity/asset move for the history books.

Do you think there is any power in the last stages of a parabolic move based on a 200 year chart move..? This is going to be the ride of our lives.

Most think oil is going down and most think the US dollar is going to rip higher. The stage is set so we can get going. Watch my daily $USD chart which is BT right now, since about two weeks back. Soon the cycle will overpower and it will let go of my two necklines and start to drop towards my first POs. As I see it.