US tax receipts must continue to grow to fuel the confidence of the US debt markets.
Previous Post: Gold and Oil fundamentals are married together
In chart 1, the red dots marked A to F show the periods where US Federal Tax receipts showed negative growth year over year (YOY). US tax receipts have slowed due to the inflation fighting measures applied by world governments. US inflation has fallen from 9% to 3%. Job done! Now some tight monetary controls can be withdrawn, a lower dollar for one. Each red dot is also timed with a slump (in different degrees) in the US Dollar index (DXY).
POINT: A fall in the US dollar is one of the methods used to inject more US dollar liquidity, or easier money, this tends to be inflationary. A rise in the US dollar removes dollar liquidity, or tighter money, this tends to be deflationary.
When the US dollar falls, it allows for higher prices for gold and oil. Depending on oil fundamentals at the time, both oil and gold can rise dramatically higher. Tax receipt slumps A, C, D, E, and F enjoyed handsome games on recovery.
Currently YOY% change of US Tax Receipts are negative, this should be followed by a lower US dollar and higher gold and oil prices over the next 6 to 12 months. By how much, we shall see.
Chart 1 - US dollar, US tax receipts, gold and oil.
Chart 2 - US Dollar Cycle: Plenty of room to move down for the DXY.
Chart 3 - US Dow Jones Cycle: As a falling US dollar is easy money liquidity injection, will it be enough for stocks to move higher in line with 900 day period cycle. Why not!
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Changes in the world is the source of all market moves, to catch and ride the change we believe a combination
of Gann Angles,
Cycles,
Wyckoff and
Ney logic
is the best way to ride the change, after all these methods have been used successfully for 70+ years.
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Investing Quote...
..“The desire for constant action irrespective of underlying conditions is responsible for many losses on Wall Street, even among the professionals, who feel that they must take home some money every day, as though they were working for regular wages.”..
Jesse Livermore
.."It Ain’t What You Don’t Know That Gets You Into Trouble. It’s What You Know for Sure That Just Ain’t So"..
Mark Twain
.."it is better to have few stocks and to watch them carefully”...
Bernard Burach
..“One must search through a maze of complex and contradictory details to get to the significant facts … Then he must be able to operate coldly, clearly, and skilfully on the basis of those facts.” The challenge for the successful speculator is “how to disentangle the cold hard facts from the rather warm feelings of the people dealing with the facts.” Moreover, “if you get all the facts, your judgment can be right; if you don’t get all the facts, it can’t be right”...
Bernard Baruch
.."Earnings don’t move the overall market; it’s the Federal Reserve Board… focus on the central banks and focus on the movement of liquidity… most people in the market are looking for earnings and conventional measures. It’s liquidity that moves markets"...
Stan Druckenmiller