My chart is effectively identical to Graddhy’s one. If I’m lucky enough to be correct with respect to $USD falling from here after a backtest of the top rail, where Graddhy and I disagree is what $USD does once it hits point 6. Graddhy thinks it will continue falling, I think it will at least rally back up to the top rail.

    

  

Chart notes:

Chart 1) Posted by Raoul Pal to his twitter account last week. White line is DXY from 1970 to present, orange line is DXY from late 1980’s overlaid on top of it.

Charts 2 & 3) Taken from Julian Bridgen’s (can never remember how to spell the guy’s name properly), slide deck from the interview he gave at Macrovoices in late December last year.

Chart 2 shows the last two times USD rallied strongly it rose 20%-25% before taking a breather, then strongly rose again. This time around (3rd cycle), USD has risen strongly 20%-25%…..

Chart 3 shows that even in a LT USD bear market, a US tax repatriation deal alone can cause USD to rally strongly.

 

I think it is almost certain Trump will manage to pass some type of Tax Repatriation type law because so many members of the US Congress and Senate are bought and paid for by US

business interests and tax repatriation at a rate of 10% (or whatever) is what they want.