On August 28th I posted a chart showing the tendency gold's parabolic peaks (aka C-wave tops) to coincide with the 3 year cycle low of the US Dollar Index. As you will see from our first chart, the 1980 Gold parabola did not peak anywhere near a 3 year cycle low in the US Dollar Index.
Indeed, the pink rectangle targets the drop in the US Dollar index as the location of the parabolic rise, but looking at the chart from across the room one would not notice anything significant about this little bump in the road.
At present, the US Dollar index has rallied very sharply higher beginning 12 or so days ago. The immediate question is - will it roll over soon and send gold higher?
The second question is - why is gold the same price today as 12 or so days ago?
(The 1980 scenario was identical in that a very sharp rally in the dollar did not seem to faze the price of gold - other than to put it in a temporary sideways consolidation pattern).
So let's have a look at the daily cycles that led up to the conclusion of the 1980 parabola.
Now we will zero in on that particular daily cycle for a closer look at what was going on.
I do not have a crystal ball and I do not know how this will turn out.
But some of the clues have me wondering. The gold parabolas of 1980, 1983, 2003, 2006 and 2008 each concluded on the exact same day as their silver counterpart peaked. Will it be different this time?
The powerful rise in the dollar for the past couple weeks has not put a dent on gold. What will happen if the dollar now begins to fall?
Sept 15 additional thoughts:
I have yet to see a single gold parabola that concluded at the beginning of the seasonally favorable period of September. All C-waves have concluded in the December - May time frame.
I have yet to see a single gold parabola that concluded with a consolidation as opposed to a spike. Every previous parabola retested its C-wave 38.2% retracement level within a matter of days. To date, the current gold situation has only barely corrected to the 23.6% ($1705).