Best of the Week
Most Popular
1.UK House Prices Momentum Crash Threatens Mini Bear Market 2017 - Nadeem_Walayat
2.Perfect Storm - This Fourth Turning has Over a Decade of Continuous Storms to Come - James_Quinn
3.UK House Prices Momentum Crash Warns of 2017 Bear Market - Video - Nadeem_Walayat
4.Billionaire Investors Backing A Marijuana Boom In 2017 - OilPrice_Com
5.Emerging Markets & Basic Materials Stocks Breaking Out Together - Rambus_Chartology
6.Global Currency Reserve At Risk - Jim_Willie_CB
7.Gold and Silver: Your Stomach Is Probably Wrenching Right Now - The_Gold_Report
8.Warning: The Fed Is Preparing to Crash the Financial System Again - Graham_Summers
9.Basic Materials and Commodities Analysis and Trend Forecasts - Rambus_Chartology
10.Discover Why A Major American Revolution Is Brewing - Harry_Dent
Last 7 days
3 Psychological Ingredients behind Great Web Content - 17th Aug 17
The War on Cash - Rogoff, Orwell and Kafka - 17th Aug 17
The Stock Market Guns of August, Trade Set-Up & Removing your Rose Tinted Glasses - 16th Aug 17
Stocks, Bonds, Interest Rates, and Serbia, Camp Kotok 2017 - 16th Aug 17
U.S. Stock Market: Sunrise ... Sunset - 16th Aug 17
The Next Tech Crash Could Delay Your Retirement by a Decade - 15th Aug 17
Gold and Silver Precious Metals Nearing Breakout - 15th Aug 17
North Korea Showdown: Pivotal Market Turning Point - 15th Aug 17
Tech Stocks DOT COM Bubble Do-Over? - 14th Aug 17
Deep State Conspiracy or Chaos - 14th Aug 17
From the Trans-Atlantic Axis and the Trans-Asian Axis - 14th Aug 17
Stock Market Intermediate Correction Underway - 14th Aug 17
The Islamic State Jihadi Pivot to Asia - 13th Aug 17
Potential Pivots Upcoming for Stocks and Gold - 13th Aug 17
North Korean Chinese Proxy vs US Military Empire Trending Towards Nuclear War! - 12th Aug 17
Gold Stocks Coiled Spring - 12th Aug 17
Neil Howe: The Amazon-Walmart Rivalry Will Determine the Future of Retail - 12th Aug 17
How to Alton Towers Half Price Discount Entry 2017 and 2018, Any Time, No Pre-Booking! - 12th Aug 17
Top 3 Technical Trading Tools Part 2: Relative Strength Index (RSI) - 11th Aug 17
What Makes Women Better Investors - 11th Aug 17
Crude Oil Price Precious Metals Link in August - 11th Aug 17
Influencer Marketing Predictions All Businesses Should Take Into Account - 11th Aug 17
Really Bad Ideas - Government Debt Isn’t Actually Debt - 10th Aug 17
Gold Sees Safe Haven Gains On Trump “Fire and Fury” Threat - 9th Aug 17
Why Is The Stock Market Not Trading On Fundamentals Lately? - 9th Aug 17
USD/CAD - Can We Trust This Breakout? - 9th Aug 17
New Monthly Rebate to Help Reduce Your Trading Costs - 9th Aug 17
Stock Market Divergences Are Now Appearing! - 9th Aug 17
Is Inflation an issue or did the Fed Mess Up? - 8th Aug 17
Top 3 Technical Trading Tools Part 1: Japanese Candlesticks - 8th Aug 17
Researchers Find $10 Billion Hidden Treasure In A Dead Volcano - 8th Aug 17
What Happened to Thousands of Sheffield's Street Trees 2017 - Fellings Documentary - 8th Aug 17
Solar, Bubble, Banks, War, and Legal Tender: Five Reasons Why You Should Buy Silver Now - 7th Aug 17
CRASH - If Some People Do It, Nothing Bad Happens, But If Everyone Does It, All Hell Breaks Loose - 7th Aug 17
Gold and Silver : The Battle for Control - 7th Aug 17
Precious Metals Sector is on Major Buy Signal - 7th Aug 17
Stock Market - Has Time Run Out? - 7th Aug 17
Get Ready for an Historic Upside Gold and Silver Run - 7th Aug 17
BOOM! Bitcoin Rockets To New All-Time High As Cryptocurrencies Surge Higher! - 7th Aug 17
U.S. Dollar: This Crash Signals the End - 6th Aug 17
Predicting The Price Of Gold Is A Fool’s Game - 6th Aug 17
Asda Sales Collapse and Profits Crash! UK Retailer Sector Crisis 2017 - 6th Aug 17

Market Oracle FREE Newsletter

3 Videos + 8 Charts = Opportunities You Need to See - Free

U.S. Dollar Foreign Currency Pairs Analysis

Currencies / Forex Trading Jan 09, 2012 - 04:28 AM GMT

By: Tony_Caldaro

Currencies

Best Financial Markets Analysis ArticleAs we noted in the most recent weekend update, there have been some developments in the long term Secular/Supercycle patterns of the currencies. As you are aware, the USD Secular trend, or Supercycle if you will, has been bearish against most foreign currencies since 1985. We have reason to believe this ended at the 2011 price low of 72.70 DXY. The USD should now be in a Secular bull market. Initial estimates suggest the DXY should reach 140 by 2018.


In our last report, we detailed how the 17 year cycle appeared to be peaking with a blowoff top in the CHFUSD pair. The CHFUSD is our bellwether for the currency cycles. We also illustrated the CADUSD was peaking right at our targeted zone of 1.06, and the JPYUSD pair was nearing our targeted zone of 1.33. The CHFUSD blowoff looked similar to the JPYUSD blowoff top in 1995, which also ended a Cycle wave. 1995 completed a Cycle wave [A], and 2011 completes a Cycle wave [C] and the total Supercycle wave since 1985. See EURUSD chart below. Long term currency waves move in ABC’s.

In the past few weeks the USD has confirmed an OEW long term uptrend, and the EURUSD an OEW long term downtrend. This confirms our previous analysis and we expect most foreign currencies will be declining against the USD for the next seven years. Now to the specifics.

The CHFUSD pair peaked in 2011 at 141.44. Since then it has declined steadily and is currently around 105. With the Supercycle top completed, as noted on the chart, we expect the CHFUSD to continue to decline until it hits around 96 this year. Then we should see a bear market rally to around 118-120 during 2013. After that a decline to around 70, or lower, into 2018. These two support levels are noted on the monthly chart by blue lines.

The EURUSD pair peaked in 2008 at 160.20. Since then it completed another set of ABC Primary waves with lower and lower highs. This is somewhat similar to the price action in the 1990′s. With a long term downtrend now confirmed in this pair, we expect the current decline to continue until it hits around 116. A bear market rally should follow at that point into the 129-133 range by 2013. After that a decline to around 82, or more, into 2018.

The USD/DXY bottomed in a Primary wave A in 2011 at 72.70. With the long term uptrend now confirmed we expect the DXY to rally to around 87 in 2012. After that it should decline, with the bear market rallies in the CHF and EUR, to around 77 in 2013. Then we expect a massive shift out of all foreign currencies and commodities into the USD. This USD bull market should continue for about five years as the DXY hits 140, or more, in 2018. During this 2013-2018 time period there could be a reorganization in the Eurozone, and/or a resetting of the world’s currencies. The USD, and then USD denominated assets should be in great demand between 2013-2018.

The JPYUSD pair appears to have topped at the recent 132.18 high. Thus far, it has not declined much while the CHF and EUR have headed lower. This appears somewhat similar to the early bull market waves after the last Supercycle low in the USD in 1978. Then the JPY and CHF were declining while the DMK and GBP held steady. The USD/DXY rose during the first year after the low, but the rally was kept in check by the DMK and GBP. This time around, it appears, the JPY, GBP and CAD are keeping the DXY in check during its first rally. In 2011 the CHFUSD appeared to be the most overvalued currency in the world. In 2012 the JPYUSD appears to have that distinction. When this pair does start to breakdown we’re expecting a price low of around 74, or lower, before 2018.


CHARTS: http://stockcharts.com/...

http://caldaroew.spaces.live.com

After about 40 years of investing in the markets one learns that the markets are constantly changing, not only in price, but in what drives the markets. In the 1960s, the Nifty Fifty were the leaders of the stock market. In the 1970s, stock selection using Technical Analysis was important, as the market stayed with a trading range for the entire decade. In the 1980s, the market finally broke out of it doldrums, as the DOW broke through 1100 in 1982, and launched the greatest bull market on record. 

Sharing is an important aspect of a life. Over 100 people have joined our group, from all walks of life, covering twenty three countries across the globe. It's been the most fun I have ever had in the market. Sharing uncommon knowledge, with investors. In hope of aiding them in finding their financial independence.

Copyright © 2012 Tony Caldaro - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2017 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Catching a Falling Financial Knife