Dollar Due to Decide …

Monday was day 14 for the daily dollar cycle and the dollar appears to be forming a triangle consolidation.

The dollar will need to decide which way it wants to break out of consolidation. Considering that the previous daily cycle was a left translated cycle and that the dollar has only entered week 14 of the intermediate cycle, we are expecting a downside break of this consolidation.

Gold has been consolidating its 160 point rally off of the panic low. Gold also appears that it needs to decide if it will break below the daily cycle trend line or give one more surge higher and break above the 1480 resistance level. A bearish break on the dollar should yield a bullish resolution for gold.

Monday was day 17 for the daily bond cycle. After the big sell off on Friday, bonds provided some follow through lower. However, bonds closed up off the lows of the day. Remember that we are watching to see if bonds break below the previous daily cycle low of 119.88. Given that this is the second daily cycle of a new yearly cycle bonds should be forming right translated cycles. A break above 121.26 forms a swing low. However, a break below 119.88 signals that the intermediate cycle is already in decline.

Over the next few days we should know the how some of these questions get resolved …