SAME DAY UPDATE: One More High
As usual, the moment I publish the market reverses… but I like the new count even better and it provides better timing for people who haven’t yet made their trade. I think we will have one more high in the US Dollar, that is in progress now and will terminate at or before 95.3 before resuming the downtrend.
Of note, even if I am wrong about the overall downtrend resuming, this structure could double as a leading diagonal (instead of ending diagonal), and could then still correct from the endpoint, boosting metals and other commodities in the shorter term as the dollar crossed back towards the pattern’s opening level to 91 or so.
Here you can see the count leading up to the top. I called it just one ping too soon in the previous article, where what is now labelled as a triangle abcde in red could have been a leading diagonal down, we got one more rally instead.
To me this can be counted as a remarkable series of extended 1st waves, two end very near precisely 78.6% (1 and 3), while the second and largest ends at 61.8%. The rule for extended 1st waves is that they are supposed to end somewhere between 61.8% and 78.6% so these adhere perfectly. The largest 1st wave impulse is counted and shown as a leading diagonal, which also explains its funky shape, while adhering oddly but perfectly to leading diagonal rules. Leading diagonals have a connected 1 and 3 as well as a connected 2 and 4, with 5 finishing within the trend parameters of the 1-3 connection, while also being composed of zigzags (ABC’s) as opposed to 5 wave impulses… this is the first time I’ve personally seen an Extended 1st Wave as a Leading Diagonal. And this is what you get in some 4th wave “impulses” – a sloppy mess, yet somehow beautiful.
This is the dollar weekly chart or so (5 hour bars), and you can see the impulse as it began in April last year. I think we have at least one wave to go further down.
If we look at the US dollar as far as investing.com gives us data, it can be drawn in a channel. Many, many financial analysts have called for the US Dollar to head substantially lower for decades, primarily due to trade deficits… I think we may have finally gotten a ticket on that train although it could take the better part of a decade for this to occur.
While the prices we pay for foreign goods and overseas lodging will certainly be significantly higher, this move alone should move us to a much more competitive stage for our goods in the global marketplace. Hopefully manufacturing can make a comeback here stateside.