Metals Rebound

July 8, 2013

Metals rebounded today after Friday’s drop.

Silver and gold were up 1.70% and 1.91 respectively. Platinum gained 2.56 and palladium leading the charge with 2.81%

I think the strong showing on metals can be attributed, in part, to the dollar faltering today.

As we discussed in the weekend report, the dollar is in a new intermediate cycle, and therefore we expect the first daily cycle to form as a right translated cycle, peaking on or after day 12. Since the dollar set a new daily cycle high on Monday, which was day 13, the dollar appears to be fulfilling that expectation.

However the dollar printed a bearish reversal closing near the lows of the day. That eases the parameters to form a swing high. A break below 84.14 forms a swing high. We would then watch for a break of the daily cycle trend line to confirm the daily cycle is in decline.

Taking a closer look at gold we see that gold appears to have set the daily cycle trend line on Friday. Monday gold reversed higher off that trend line. Now we need to see gold follow through by breaking out to a new daily cycle high.

Palladium did break out to a new daily cycle high today.

Palladium is once again leading gold. Palladium has broken out to a new daily cycle high today, gaining 10.52% off the daily cycle low. The daily cycle looks strong and also looks to be on the way to printing a right translated daily cycle.

That would be good news for gold bugs …

3 responses to “Metals Rebound”

Forex Kong

July 8, 2013

Yo LM – Great stuff as always.

You’ve suggested a new intermed cycle in USD based on the breach / creation of the new high during this daily.

What does that do for your yearly count then as a few weeks ago we’d have assume / expected a failed cycle here and then moves heading towards prior lows in coming weeks/months.

Could you still fit this “interesting anomoly” of the buck poking up to a new high into the prior longer term analysis considering that it’s more or less been brought on by Fed talk of tapering?(which we all know isn’t going to happen)

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1. likesmoneystudies
  
  July 9, 2013
  
  Forex Kong,
  
  I did address this in the Weekend Report. Here is a summary.
  This move marks an intermediate and yearly cycle low. That makes July month 1 for the new yearly cycle.
  The dollar is in month 26 of its current three year cycle. So we need to adjust our framework to have the dollar’s yearly cycle and three year cycle trough due in 8 – 14 months.
  Eight of the eleven three year cycles since 1978 have concluded with a failed yearly cycle. So there is a good likelihood that this new yearly cycle will also fail.
  
  Reply
Forex Kong

July 9, 2013

Wow…..talk about an adjustment to the framework, and implications moving forward.

Right translated dailies to follow and some “new highs” – as this daily ( and the next ) should make “higher lows” than June’s yearly low.

Commods / – yikes! As lining this up fundamentally would see USD taking in flows as “safe haven/ reserve” and likely be suggestive of a “risk adverse” environment.

Thanx LM – as always.

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Metals Rebound

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