usd index uptrend cycles

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Post on 14-Jan-2016

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The file contains an analysis of the percentage change in the USD Index during uptrends against major currencies. Based on this, the USD should continue to appreciate by at least 15% from here (June 2015).

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USD UptrendsPrice-adjusted Major Currencies Dollar Index -- Monthly Index (FED Data)We can see from the above chart that the USD Index has further room to appreciate, judging from historical price patternsThe previous two multi-year USD upward trends lasted for :- 76 months for the uptrend started in Oct 1978, for a total appreciation of around 60%- 81 months for the uptrend started in Apr 1995, for a total appreciation of around 49%We are currently (June 2015) in month number 46 of the uptrend started in Jul 2011 and we reached a maximum appreciation of 33% in month number 43 (March 2015).Also, as can be seen from the chart, we are currently in an area where corrections usually occur (time wise). Thus:- for the uptrend started in Oct 1978, a correction of 8% occurred between months 47 and 50- for the uptrend started in Apr 1995, a correction of 10% occurred between months 39 and 44Consequently, time wise, we should have at least another 30 months of USD uptrend ahead and another 15% (at least) appreciation.Based on this and on the fact that USDJPY has already played a large role in the USD's appreciation (percentage wise), then European and commodity currencies should bear the major brunt of further USD appreciation. This should take :

- EURUSD towards 0.90 (currently 1.1350, with potential to go to 1.18 before lower)- GBPUSD towards 1.35 (currently 1.5850, with potential to go to 1.63 before lower)- USDCHF towards 1.15 (currently 0.92, with potential to go to 0.89 before higher)- AUDUSD towards 0.60 (currently 0.7750, with potential to go to 0.80 before lower)Enjoy the USD uptrend for another 30-40 months and prepare selling it afterwards!