Dollar Bounce …

June 19, 2013

Ben Spoke and the dollar bounced

Wednesday the dollar started off and printed a lower low. This was the lowest point since the day 16 peak. Then the dollar shot higher. A break above 81.50 forms a daily swing low and confirming a new daily cycle. As we have been discussing with the dollar, since this intermediate cycle has already failed, all subsequent daily cycles should form as left translated, failed cycles peaking by day 8.

Stocks reacted badly to the dollar’s strength today.

Wednesday was day 9 for the daily equity cycle. Stocks formed a swing high today. If stocks break below the developing daily cycle trend line that would signal a daily cycle decline. A break below the previous daily cycle low of 1593.23 confirms a failed daily cycle and intermediate cycle decline.

Gold is still trying to find is daily cycle low.

Wednesday was day 21 for the daily gold cycle. Gold is in the timing band to print a daily cycle low. Gold has breached the lower stem of the triangle that we have been watching. Gold is at risk of breaking below the previous daily cycle low of 1338.60 and printing a failed daily cycle. That would signal an intermediate cycle decline.

Triangle consolidations have been know to shortened cycle counts. As long as any decline stays above the April pivot 1321.50 a shortened weekly cycle could be in play.

A we previously mentioned the dollar has a failed intermediate cycle. That should lead to an intermediate cycle decline. Since we are expecting a shortened dollar cycle, a dollar peak could coincide with a meaningful bottom for gold.

7 responses to “Dollar Bounce …”

Marcos

June 19, 2013

Hi Likes Money,
what do you mean with:

“should form as left translated, failed cycles peaking by day 8.”

can you do a dictionary of your concepts and definitions, please? I do not understand…

like left translated cycle.

Greets

Reply
1. likesmoneystudies
  
  June 20, 2013
  
  Marcos,
  
  Thanks for the suggestion.
  By translation I am referring to the nature of the cycle, be it a daily, weekly, etc.
  Any cycle is defined by three points, the cycle peak with a cycle low on both sides.
  A series of daily cycles tend to print higher daily cycle highs until the weekly cycle peaks.
  The the daily cycles will print a series of lower highs.
  
  Right translated cycles will peak past the half way part of the cycle.
  So if it is expected that a daily cycle for an asset runs 20 -24 days, a swing high formed on day 17 could be the cycle peak.
  
  Consequently if a larger cycle has failed, then it is past its cycle peak.
  Therefore the expectation will be for the smaller cycle(s) to form as left translated, failed cycles.
  
  Until I can find time to develop a glossary here is a link to Walter Bressert’s manual on cycles.
  
  Click to access Manual.PDF
  
  Reply
pk34145

June 20, 2013

LM,
Now that the April low in $GOLD has been breached, must we accept that we are in the second daily cycle of a intermediate cycle decline? This new intermediate cycle was never confirmed with a weekly swing low nor with a trendline break. Could this be a very extended intermediate cycle with the yearly cycle low still in the future?

Reply
likesmoneystudies

June 20, 2013

pk341145,

$Gold has done a masterful job in disguising its cycle counts as you have pointed out.
I do plan on discussing this tonight.
I find that when cycles offer different interpretations that it helps to look at the larger cycle, in this case the yearly cycle.
$Gold has not confirmed a new yearly cycle, so by definition it is still in a yearly cycle decline. Then we will look at the intermediate cycle in relation to the yearly cycle.

Reply
alex

June 20, 2013

L.M.

If I look on STOCKCHARTS , the dollar shows up as being on day 5 (And approaching the 20sma overhead…possible resistance). You have us on day 1?

I just wanted to mention this so you can check stockcharts and tell us which to use…thanks!

Reply
1. likesmoneystudies
  
  June 20, 2013
  
  Alex,
  
  I have some concerns over the accuracy of STOCKCHARTS on 24 hour assets like the dollar.
  I do STOCKCHARTS from time to time, but rarely for the dollar.
  
  Reply
vorfahrt

June 20, 2013

I stick with the commodity bear, including gold. The US$ IMO made a yearly low here and will go up meaningful, trashing commodities along the way. Stocks should still be in a bull, but closer to the end than to the beginning. King $ is back and rules. Real interest rates are turning positive and ensure that gold is as dead as in the 80s and 90s.

Reply