$US Dollar Index

On the eve of the French election, I thought I’d focus on the $USD index. It is at a pivotal point. I’m doing my analysis one-eyed this morning and it is not easy. What I ask is the board’s help from a strictly cycles point of view. Please refrain from commenting on this thread until some cyclic work/comments appear. In fact, I am really hoping those with the J.M. Hurst Cycles Course background and knowledge step forward. I certainly have been guilty of relying at times too much on Sentient’s amazing Hurst features, that I do not check the basic fundamentals of Hurst’s principles. So here we go. Please help me with what I am seeing this morning.

Many wonder what the status of $USD is going to be. I have not been very bullish on it since late last year.

Here is the long view with peaks/troughs, and a basic gold/currency nominal model ST is using as reference. I don’t have the energy to finesse the phasing, but you can see the issue. The index tends to make nice simultaneous peaks and complex bottoms. The cycles lines shown are 7.5-8 and 15 -16 year cycle periods. If you’ve studied cyclic theory, you would easily see what is going on here.

So there is an implied peak here of at least the 7.5 - 8 and 15 - 16 year cycles. The start to this year has been rather bizarre given what the $USD is doing and the position it is in. The index has violated a number of VTLs and tested on Friday the 22 month VTL (yellow). If this trendline breaks, there is going to be a reaction.

The other shorter term VTL breaks are shown here.

The FLDs are no where near a set up for a cycle low although Sentient phasing is suggesting one is due imminently. In fact those FLDs shown are setup for a downtrend.

The index just seems to have made a new 23 week peak here in April while gold and silver get beaten down? At least the Euro seems to be right on this for now.

All my technical screens on the $USD index are on sells, on daily and weekly. There is nothing to support a bounce here. The fact that the index managed to eek out a new low on Friday is noteworthy. If I was looking at this setup just as a price chart, I would be skeptical of the breakdown possibility and assume a good bounce is likely. However, Hurst principles and fundamentals are raising flags everywhere. Please join me and have a look.

cheers,
john

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Nice chart and as GBP/USD tanked on that surprise Hung Parliament in UK, that’s also panning out

While cycles are defined from trough to trough in Hurst analysis, others may define cycles as ‘turning points’ that may or may not synchronize to troughs.

A couple that come to mind are Armstrong and Hadik.

I’d like to offer an example of a ‘cycle inversion’ in the DXY.
Generally speaking, Hadik identifies cycle progressions where cycles will synchronize to troughs and then flip and synchronize to highs.

From the 8/15 Low to 5/16 Low-36 weeks. The DXY then rallied 35 weeks to 1/17.
Though he does not use the term cycle inversion, some may consider this to be an inversion.
He uses the term progression. He then sets a possible high 35-36 weeks from 1/17 to get 9/17.

I do not subscribe to his service, but do read free updates that he writes.

There are plenty more examples of different assets demonstrating such cycle progressions that I can post if any are interested.

Bryan

USD long view. One final leg up next year?

Daily view. Expect bounce out of 20w trough then more weakness into November.

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