The 1/03 Morning Update

January 3, 2013

I must admit the dollar continues to throw curve balls.

As we discussed in the weekend report, I believe that the dollar printed a shortened daily cycle on Thursday, 12/20.

Today makes day 9 of the new daily cycle.

This breach of the cycle trend line could indicate another surprise from the dollar.
That a intermediate cycle low was also left behind on 12/20

But the dollar on the weekly chart chart is still being contained by the declining weekly cycle trend line.
So we will continue to observe what develops here.

Gold and the Miners rallied yesterday furthering their bullish cases.

But I want to look at the CCI

The CCI ran a stretched daily cycle and just formed a swing low on Wednesday.

Since this is so late in the timing band, holds the promise of being the daily cycle low.
Once we receive confirmation with a break of the declining cycle trend line I believe that commodities will fly.

Equities printed their daily cycle low on 12/31 and they look like they are ready to fly already up an impressive 4.58% off the intra-day low on 12/31.

A swing low was formed on Wednesday forcefully declaring day 1 to a new daily cycle.
This recently completed daily cycle ran short at 29 days.
We will need to keep in mind is that the next daily cycle may ‘balance’ this cycle by running long.

So we will keep our eyes on the dollar

But so far this year, equites are taking an early lead …

8 responses to “The 1/03 Morning Update”

trondtveten

January 3, 2013

According to economic theory, the dollar becomes strong when US Treasury yields rise, like in the recent days. That happens because foreigners exchange into Usd in order to get access to the increasingly higher interest rates inside the country. Could maybe be incorporated as one of the elements in the dollar analysis. (It doesn’t always happen).

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Joe

January 3, 2013

There is also the turn-of-the-year effect – usually the US$ goes down into the new year and reverses immediately after. This effect is only a few days on both side of new year’s day and we could be in the middle of it.

Reply
1. likesmoneystudies
  
  January 3, 2013
  
  Joe,
  
  Have you observed this over multiple years?
  
  What years specifically have you noticed this?
  
  Reply
  1. Joe
    
    January 3, 2013
    
    Hi LM: Below is the link for the US$ in post-election years and on the website you can find the same for election years. You can see the dip and zip around the year change.
    
    http://www.seasonalcharts.com/zyklen_wahl_usdx_postelection.html
angelo851

January 3, 2013

Gary Savage on his blog seems to have given up on cycles for the time being and says that there is substantial manipulation occurring in PM’s and Gold so he can’t figure out where we are in the cycles. Do you agree with him? Thanks.

Reply
1. likesmoneystudies
  
  January 3, 2013
  
  Angelo851,
  
  I would agree that there is substantial manipulation.
  
  I am not ready to “give’ up on cycles.
  
  My cycle tools have been working.
  
  While I did not anticipate a 10 daily cycle for the dollar, I did identify it in my weekend report.
  This morning I was pointing out that the trend line breach on the dollar could indicate a new intermediate cycle and that is what appears to have happened.
  
  Cycles are still working for me to help interpret the market action.
  
  Now what cycles are telling me (today) may not be congruent with a bullish outlook on metals and equities — that’s a different matter 🙂
  
  Reply
  1. angelo851
    
    January 3, 2013
    
    Thanks
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