We are only 1 or 2 years away from another full-blown global competition for currency devaluation. The next crisis will NOT be like 2008. In 2008 we began the crisis with the US Dollar Index (DXY) at an all-time record low and the crisis caused a flood into the dollar. Where we are now is much more similar to 2000: High dollar, high stock market, quiet commodities market, incoming easy money policies. Additionally, the Fed is acting very preemptively. They will not wait until recession is blatant before they take action (like in 2008), they're already doing QE4, which means if the economy turns lower even more ---> they will launch an official and permanent asset purchasing program in order to keep rates low.
We are at the beginning of the end game now: Which is a global race to devalue the currency in order to keep asset prices up and to enable insolvent governments to continue to print and borrow. The global banking system will soon need massive central bank interventions, bigger than anything we've seen before. Look for a new all-time low in the DXY below 70 to be set before the mid-2020s.
تم فتح الصفقة
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I believe 103.87 achieved in December 2016 was the top of this long-term cycle. Lets watch and see
تم فتح الصفقة
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The dollar should experience some strong overhead resistance. Lots of space down below. I don't think DXY will make it above 99 or 100.
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^wrong chart. Here we go -
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تعليق
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next round of weakness should be coming in the next few weeks
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I still believe 100 will not be surpassed.....Corona Virus may have something to say about that
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My fundamental thesis has changed.
Much of the above I still believe is correct long-term. But for 2020 I think there exists great risk of a mega dollar spike, which would be very painful for stock markets and particularly emerging markets. In the short-term (2-7 months) I'm dollar bullish
Hey br, great analysis. I believe it could break slightly below the bottom trend line but will continue with upward momentum with a great buy opportunity. Lets see what happens :)
@Ludwig_Von_Mises, I never bought as their were no great opportunities.
TRaDeTaCuLaR
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@Ludwig_Von_Mises, I didn't commit to the buy, bc my analysis never confirmed anything. That's why it's good to be patient. Great call though. I love your stuff
Ludwig_Von_Mises
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I believe 103.87 achieved on December 16th, 2016 was the long-term top. The next cycle has already started
doq
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Very well explained ...this is what I've been trying to explain to people too; that the next recession won't be like 08, but like 2000 and really even more like the 70s. In addition anybody who reads history knows the "fed is independent" rap is bunk. Since the 60s the fed takes orders from POTUS period, no exceptions.
Siegemp555
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It is in the nature cycle. The market is nature structure. This gigantic wave has a beginning and an end. The wave has to finish, thus the bullish wave has ended. Time for bearish action. The market will sell any spikes for the next 5-10 years. Cheers!
Ludwig_Von_Mises
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I think FOMC tomorrow will smash DXY....I could be wrong. We'll see what happens but if DXY gets back up to $100 there's going to be more dollar shortage problems that are worse than repo currently