On the Clock …

Free Image Hosting at www.ImageShack.us

Thursday was day 20 for the current dollar daily cycle.

Free Image Hosting at www.ImageShack.us

The dollar daily cycle normally runs 18 – 25 days from trough to trough.
Some have stretched to 28 or 29 days.

The dollar is in the timing band to seek out a daily cycle low.
With each passing day, the dollar increases the likelihood of printing a top.

I came to the realization today that the current intermediate cycle is similar to the 25 week cycle that occurred one year ago.

Free Image Hosting at www.ImageShack.us

Last year, the dollar consolidated for 17 weeks before breaking out.
The break out was a continuation of that cycle that stretched to 25 weeks.
That was difficult to interpret in real time.
It seems to me that the dollar is in a similar pattern.
Currently the dollar went through a 16 week consolidation before breaking out.
Since an intermediate cycle low printed during that consolidation, I do not expect this to stretch to 25 weeks.
The weekly dollar cycle normally finds its low between 16 and 23 weeks.
Allowing for another week to conclude this current daily cycle and add another 5 weeks for another intermediate cycle and that would bring the dollar to week 19 and right in the timing band for an intermediate cycle low.

This view of a 25 week cycle followed by a 20 week cycle and now on week 13 is congruent with what I see on the monthly cycle.

Free Image Hosting at www.ImageShack.us

The dollar typically prints a yearly low every 9 – 12 months.
I have noticed that a decline into a three year low can extend the cycle to as much as 18 months.
So the dollar peaked in January and formed a swing high and found its yearly cycle low in February.
The next month a swing low was printed and the dollar began a new yearly cycle.
That February yearly low coincides with the 20 week intermediate low printed in February.

So we are back to waiting on the dollar to form a daily swing high to help complete this picture …

Free Image Hosting at www.ImageShack.us

6 responses to “On the Clock …”

  1. ponomo Avatar
    ponomo

    I thoroughly enjoy reading your cycle analysis. Great work!

  2. StemSki Avatar

    Hi LM,

    I wondered where your update was yesterday. Now I know.

    Let’s look into the future a little shall we and try to predict where the dollar is going. I have learned one key thing and that is everything most of the time is controlled by the dollar. Equities, oil, PMs, etc…
    I do not have the time to understand currency trading. In fact it kind of scares me with all the leverage involved. Anyway, I digress.

    What I wanted to share with you is a chart from SpringheelJack at http://www.channelsandpatterns.com where he shows an inverse H&S pattern that has formed in the dollar and the neckline has been broken. The target for this IHS is 90.5 to 91.5. What I thought was interesting is that his analysis suggests that 83.5 is a key level for a retest of the neckline which is 81.8. This could coincide well with the end of the daily cycle since the dollar is approaching 83.2. But after the retest, the dollar may be headed above 90 in short order. These IHS patterns are very strong and usually the target gets met.

    Anyway, just a different way to look at things.

    I was happy with my UUP buy at 21,81. Nice 5% gain. Last year I bought FXY (Yen) and FXF (Swiss Franc) which rose 13% and 35% respectively even though the dollar rallied. I already bought FXY @ 117.50. FXF is still declining. I hoping to buy them again like last year

    Anyway, here is the chart for the IHS pattern. All credit goes to SJ.

    http://www.screencast.com/users/springheel_jack/folders/1205/media/8e78ed96-18bf-413a-ba1a-ef5859baaeab

    In conlusion, based on where we are in the dollar’s yearly cycle, what can we expect from the next couple of daily cycles. Are there any predictive signals like 1st cycle out of low is RT, etc…..

    I guess what I am trying to figure out is how to improve my trading by using cycle knowledge.

    We know when swing lows should form based on standard cycle lengths. If I were to trade that is enter a long position at a swing low, how do I know whether that trade will profitable. It could on day 4 and then decline for another 18 days to the next swing low. Is there a way to predict what type of cycle (LT or RT) will form under various points in the bigger cycle.
    I need to get some sort of an edge up by knowing the most likely route that the dollar will take

    Any thought?

    I am basically trying to focus on intermediate cycles

    Aaron

    1. likesmoneystudies Avatar
      likesmoneystudies

      Aaron,

      Between last night’s report and the weekend report pretty much covered the dollar in terms of where it is in the different time frames.

      At week 21, would expect the current daily cycle to bottom soon.
      At week 13, the next daily cycle stands a pretty good chance of being the concluding daily cycle for the intermediate cycle.

      A concluding daily cycle should be a left translated and failed cycle.

      The big question is what happens to the yearly and 3 year cycle …

  3. Jack Dog Avatar
    Jack Dog

    Hello,
    Anyone want to play Choo Choo? Got a fresh set of new tracks if anyone is interested!
    Likesmoney, Alex, and Jeff thanks for the well wishes. Great to be back.

    Man, gone for a week and this is all you guys can do for putting the brakes on the dollar. Guess I could buy a bunch of Calls out of the money, that usually works. Anyway, when this finally does swing, ” WOW “! Would like to think that the August 23rd, 2010 high will put a plug in the ceiling. At the high of today let it go ahead and take our .30 cents and get it over with.

    Likesmoney, read through all of the reports since last week today, you have really done your darnest to figure this one out. Don’t fret over it to much, from what I can tell, you have been more on target than the others.

    Thanks Again,
    Jack Dog

    1. likesmoneystudies Avatar
      likesmoneystudies

      Jack Dog,

      Great to have you back on “track”.

      The market has been waiting for a catalyst and maybe the Jack Dog on track will be it …

      1. Jack Dog Avatar
        Jack Dog

        LoL we’ll see. Thanks

Leave a comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.