By Poly

This is an excerpt from this week’s  premium update  from the The Financial Tap, which is dedicated to helping people learn to grow into successful investors by providing cycle research on multiple markets delivered twice weekly. Now offering monthly & quarterly subscriptions with 30 day refund. Promo code ZEN saves 10%. 

usd

The dollar has made a Day 16 high which guarantees a Right Translated Cycle.  Of course, this is bullish action, especially when viewed in isolation.  But what we have driving the currency market here is the Euro correcting into an ICL after what was a very long and sustained IC rally.

Mario Draghi and the ECB will announce their policy response this week to what has become a rapidly slowing inflation outlook.  The expectation is that they will lower rates to stimulate growth and lower the Euro.  This in theory should drive the dollar higher, but as the Euro is oversold already, we could be in for a case of the “news being priced in”.  Based on the fact that the Dollar is overbought and due a Cycle high, it looks as if the reaction to the ECB might take many by surprise and instead be (at least short-term) bullish for the Euro.  This should help to drive the dollar into a shallow DCL, temporary relieving the Euro of its oversold status, before the Euro falls again into a deeper ICL during the early summer.

6-4 dollar daily

 

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One Response to “Cycle Counts For US Dollar”

  1. Anthony Alfidi Says:

    That US dollar secular cycle has a lot to with generational psychology. Check out the growing literature on the Fourth Turning and generational dynamics for insights into what drives macro trends and currency values.

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