S&P500 viewed by DXY Investors - US Dollar - Repeating to 1999

1156 5 18
If you consider how the US stock market looks when viewed from the eyes of the collective non-US investor in a "trade-weighted" view, then you would see the US Stock Market in this form. When you own the US stock market, you first own the currency, the US Dollar             . But no "one" owns the DXY             , rather, it is an approximation of the weighted (by trade) average of the major trading partners. The index is updated to reflect the collective trade between our countries, and again, it represents a "psychological collective" of non-US investors. US Investors would always like to see this chart go up because it show wealth building and the purchasing power of the US Dollar             in our trading partners currencies.

A quick pattern I noticed was the 257% advance from 1994-1995 up to the 1999 had three rather sharp corrections in it, labeled 18%, 30% and 19% before one last 46% advance which lasted 48 weeks into the high at the peak in September 2000 where it proceeded to lose 56% of its value in the next 3 years.

The current pattern is rather large also with a 256% gain to the peak in March this year (2015) and there is a 16%, 23% and currently 20% correction that we just lived through. The big question - do we have another move higher to put in the top or is this enough here to signal the top is already in? Isn't that interesting that they are very similar?

The market's ability to absorb news and discount known future events, like Presidential elections, interest rates, tax rates, and tax law changes, is the power of the marketplace.

Whoever decides first gets the biggest prize.

What do you think?

Last point: Isn't it also interesting that we had a "technical 20% bear market in the S&P500" using this DXY             adjustment?


10:19PM Sunday, September 20, 2015 - Glad to have found this very interesting pattern.
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Another feature is that #1 and #2 overlap each other...
Reekardo timwest
are we near that sp top again? or did we see the blowoff today? the monthly pivot resistance was touched.
yes very interesting... how do you trade it?
timwest Reekardo
Look for an important US stock market top in a few months and go short the DXY. The interesting part of this chart is that we might have another leg up, which frankly I wasn't expecting.
alex.a timwest
interesting ~ Very interesting comment, Tim ~
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