In this article we attempt to survey current conditions of main asset classes and what is expected in 2017.
With no delay, here are the details.
I have been bullish on Dollar since 2007-8 period. Never wavered in between in spite of the calls for Dollar demise by the best of prognosticators all along. For quick proof see my articles here on this site from that period. President Donald Trumps election, seems to have added to its strength last few months, even though last few weeks we saw clear correction. Our expectation is that Dollar top in 2017, while having chance to repeat echo top Next year. April is the first period where we would expect initial topping to take place. Above is the Dollar chart with a predictor Dark Line and actual Dollar Red Line. This prediction was made public, for the first time about 30 trading days ago.
It is my belief, that stocks are in a gigantic topping process, that will be clear to all by the end of the year. Meanwhile we could have up and down YO-YO market, that will confuse and suck many mistakenly enthusiastic into it. Is this to happen with a 1987 type move first, or is it to happen 1957 way. I am not sure, but as a trader cannot prelude any of these outcomes. Likely Top months are April and August./September.
Bonds are likely to go down all along with the rise, or glide of the stock market and that too will be trading affair. Likelihood that they made the secular ( interest rate) lows is good even though they bumped along the lows for over five years.
For Bond action, it is easy to follow our Dollar predictor as each rise in Dollar is likely to be met with the rise in interest rates.
I have become bullish on GOLD In both January of 2016 and 2017 with bearish stancein mid 2016. Same went for all PM's and Miners.
Gold, Precious Metals and Miners
I think, again, by following the Dollar, it will be easy to see where the PM's will end up, even though there will be differentiation between them.
Since Dollar Index is 57% EURO, it is clear how to follow euro with our Dollar Predictor. Rest of the Euro Region currencies are to follow the EURO, but Petro Currency, such as Norwegian Krone, may show marked differences depending where OIL moves. Asian Currencies are likely to also follow the Inverse of the Dollar, but YEN may be receive the brunt of Dollars Wrath. Chinese Yuan is likely to see similar or worse faith depending how USA and CHINA get along.
Oil is likely to have one more move higher and if / when it does, it may, finally cause the recession in USA and help the move lower the stocks market as indicated above (stocks section).
Have a happy and prosperous year.
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