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Hold on, I just peeked at the non-seasonally adjusted figures, the raw M-3 numbers. Gosh, it seems M-3 was up $18.4 billion last week. And over the past twelve weeks? Up $271 billion, on a pace to grow money over a trillion dollars this year — and that’s with the accountability of a reported M-3 figure. Scratch the accolades. It appears that the mild growth for one week might have more to do with the “adjustment” and in fact they did announce a change to the adjustment formula this week. It looks like they have started using the X-12-ARIMA procedure to calculate the seasonal adjustment. Well, by golly, that worked quite well, wouldn’t ya say, ole chap?
The U.S. Dollar completed its second wave A up and second B down of a Double Flat/Zigzag corrective intermediate-term rally. The final wave C to a corrective Primary wave (2) top is next, and may have started. We can estimate the timing of the start of the Dollar’s coming collapse into the 60s (probably even lower) by doubling the time the first A-B-C (a Flat 3-3-5 pattern) took for corrective Primary degree wave (2) up. From the time the U.S. Dollar’s Primary (1) bottomed on December 31st at 80.39, to the time the first of what will be two A-B-C patterns topped at C on July 8th at 90.77, was about seven months. Then the dividing wave, X, took the Dollar down to 86.02 on September 2nd. That timing says the start of the decline should arrive coincident with the March/April period when M-3 is hidden and Iran starts selling oil on its bourse in euros. There is an alternate EW labeling for the Dollar, mostly out of respect for the Head & Shoulders Top that has formed. That alternate suggests the top is in and the decline is underway. The decline is choppy, with overlapping waves, so if the Dollar has topped, then we likely have seen two degrees of waves one down and two up, with a pair of small degree threes down coming next. Our leaning is that the Dollar probably has more upside left and the top count is transpiring.
Silver hit our 9.75 target Friday, reaching 9.78 intraday. We pointed out this target back when Silver was in the 6.00’s last summer. Silver has achieved the price target from the Symmetrical Triangle, where it thrust the same distance as the widest portion of the triangle. This means the risk of correction has increased substantially at this time. Traders need to think about this risk when staring at recent profits. Long-term holders need to stock up the antacids should the next multi-month buying opportunity kick off soon. Our top Elliott Wave count shown above suggests a small decline is due, Minor degree wave 4, to be followed by the final rally to a wave (1) top. However, be mindful that the last wave of a long move can truncate, so wave 5 up does not have to better Friday’s levels. Might Silver hit 10.00? Sure, but the risks are greater here to capture that last 5 to 10 percent than during the past several months.
“Or
do you not know that the unrighteous shall not
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INFORMATION The opinions of FSU contributors do not necessarily reflect those of Financial Sense. |
