Bitcoin Plunging as Gold Rallies; 40-Year Cycle ‘Seismic Shift’ Begins; War Cycles Concur!
01/29/22 INSIIDE Track – “2016 – 2021 was the culmination of the latest phase of multiple 40-Year Cycles – expected to time another multi-year advance in Gold as part of recurring Currency Wars – and ultimately give way to real War Cycles in 2021 – 2025.
The Currency Wars emerged right on schedule and Gold experienced the bull market that was forecast to last from late-2015 into late-2020/early-2021. In many ways, those types of financial and/or societal shifts and instability are often harbingers of more overt and geopolitical shifts & conflicts smoldering below the surface.
War Cycles… in China
Since the early-2010’s, INSIIDE Track has focused on 2021 to usher in many major shifts and represent a tumultuous period into (at least) 2025. That is the recurrence of an uncanny 80-Year War Cycle that has impacted America since its founding, Europe since (at least) 1301, AND also China.
Before reiterating the European/American cycles, a quick look at ‘recent’ events in China reinforces this cycle. In 1850 – 1864, China was devastated by the Taiping Rebellion – a massive civil war, considered the bloodiest civil war ever (~20 – 70 million deaths). It overlapped the Second Opium War in 1857-1860.
80 years later, in 1934 – 1945, China was rocked by the triple whammy of the Soviet Invasion, the 2nd Sino-Japan War, and the Chinese Civil War.
In between, at the 40-Year Cycle interval, the Boxer Rebellion (1899 – 1901) culminated a ~7-year period of conflict beginning with the First Sino-Japanese War in 1894 – 1895, followed by the Dungan Revolt and then the Japanese invasion of Taiwan.
80, 120 & 160 years later pinpoints 2019 – 2024 as the period with the greatest synergy of these overlapping War Cycles for China and parts of Asia.
War Cycles… in US & Europe
For the past 10 – 15 years, however, the primary focus of this ~80-Year Cycle of Wars has been the West… particularly America. That cycle has been forecast to usher in a new phase in 2021 – 2025 – the latest in the following sequence of major conflicts that impacted Europe, England, and then N. America:
1301 – 1302 – Byzantine raids with Ottomans attacking Nicaea; Battle of Bapheus (following founding of Ottoman Empire in 1299); Ottomans defeat the Byzantines – the Eastern Roman Empire – in the first major victory of what would be a ~600-year empire controlling Eastern Europe… a momentous shift.
1381 – Peasants’ Revolt in England – a battle against high taxes, serfdom, etc. … and a 400-year precursor to 1775 – 1781.
1461 – Battle of Towton (largest & bloodiest battle ever fought on English soil; ~28,000 died in a one-day battle; part of War of the Roses with three other major battles occurring in 1461.
1541 – Seige of Buda – led to 150 years of Ottoman control over Hungary (western extreme of Empire).
1621 – Final phase of Dutch Revolt (an ~80-year war triggered by over-taxation of Netherlands for ‘unnecessary wars’) began in 1621 after a 12-year truce. 1621 also marked the beginning of the end (1621–1629) of the religious wars throughout Europe.
[Overlapping these phases, there was the corresponding 80-Year War – from 1568 – 1648 – in which the Dutch gained independence from Spain… another powerful corroboration of this 80-Year Cycle of War.]
1701 – War of Spanish Succession (another battle for independence; a precursor to 80 years later).
1781 – 1783 – Culmination of America’s Revolutionary War (began in 1775/1776)
1861 – 1865 – Civil War in USA (triggered by conflicts in 1855 – 1856)
1941 – 1945 – US entry into WWII (in Europe since 1936 – 1938)
2021 – 2025 Next Major Conflict? Watch China, Russia AND Middle East.
The 80-Year Cycle of War timed the most noteworthy & destiny-altering revolts & battles of the last millennium – involving England, Europe & ultimately N. America. Will History Repeat?…
1-31-22 – Stock Indices rallied into early-Jan ‘22 – the fulfillment of multiple daily, weekly & monthly cycles that had projected an early-year peak in 2022 – and reversed lower, right on schedule. 1Q ‘22 (most synergistic in Jan/Feb ‘22 and ideally in early-Jan ‘22) was/is the convergence of a web of 16, 8 & 4-month cycles AND the latest phase of the most consistent cycle of this century – the 3.25-Year Cycle.
That cycle was last involved in creating the Dec. ’18 low and projecting an overall advance into 1Q ’22 – when the next phase should invert and time a peak. That would fulfill a 3.25-year low (1Q ‘09) – low (2Q ‘12) – low (3Q ‘15) – low (4Q ‘18) – high (1Q 2022) Cycle Progression. [There is a chance it could also time a low if a sharp drop into March ‘22 unfolds.]
An early-year peak and a January ’22 sell-off would also align with the 2-Year Cycle that was detailed extensively in 2018 and again in 2020. Both times, it created early-year peaks and abrupt 1Q sell-offs…
2-Year Cycle
Throughout the second half of 2021, the 2-Year Cycle was repeatedly discussed since it had spurred January sell-offs (a majority being 10 – 15% declines) in 5 of the past 6 phases. Jan ‘22 was next.
In 2010, stocks began the year with an early-Jan ’10 spike high and then a quick, sharp sell-off into the opening days of Feb. ’10. The Nasdaq-100 led the way and suffered a 10+% drop before bottoming.
In 2014, stocks began the year with an early-Jan ’14 spike high and then a quick, sharp sell-off into the opening days of Feb. ’14. The DJIA led the way and suffered an ~8% drop before bottoming.
In 2016, stocks began the year with an immediate sell-off after peaking in the final days of Dec ’15. They suffered a pair of sharp sell-offs into the opening days of Feb. ’16, losing ~15%.
Much like in 2021, many stocks had peaked in 2015 – in May – July ’15 – and then experienced initial sell-offs into late-Aug & late-Sept ’15… just as they did in the past ~6 months. After setting Aug/Sept lows in 2015, stocks rebounded into early-Nov ’15 – when most set secondary highs (just as in 2021).
A pair of sell-offs ensued – into mid-Nov & mid-Dec ’15 (very similar to 2021, when several indexes fulfilled multi-year upside targets in Nov ’21 and then triggered 4-Shadow Signals with their sharp Nov/Dec ‘21 sell-offs – portending a larger decline in Jan ‘22).
They rebounded into late-Dec ’15 – just as in 2021 – and then began another sharp sell-off during the first three weeks of January ’16.
Déjà vu?
In 2018, stocks began the year with a mid-Jan ’18 spike high and then a quick, sharp sell-off into the opening days of Feb. ’18 – again losing over 10%.
In 2020, stocks began the year with a mid-Jan ’18 spike high and a quick sell-off into the final days of Jan. ’20, a precursor to a larger plunge 6 weeks later.
In 2022, stocks were forecast to peak in early-Jan. ’22 – perpetuating corroborating 2-month, 4-month & 8-month cycles – and then see a similar sell-off, following that peak. That is what has transpired.
Most indexes have now created the largest declines since Feb/Mar ’20 – a 4-Shadow Signal on the next higher magnitude that could be warning of a larger correction after the next rally.
The 2-Year Cycle perfectly dovetailed with the ~8-month cycle (midpoint and 1/2 cycle of ~16-Month Cycle) that had been projecting an early-Jan. ‘22 peak since early-May ‘21 (later reinforced with midpoint peaks in early-Sept and then early-Nov ‘21).
The DJTA and other indexes had set multi-month peaks in the first half of Sept ’18, May ‘19, Jan ’20, Sept ’20 & May ’21. That 8-month sequence forecast another peak to take hold in early-Jan ’22.
That cycle then broke down into successive ~4-month cycles that also projected an early-Jan ‘22 peak (early-May ‘21 – early-Sept ‘21 – early-Jan ‘22).
In the midst of that, it also broke down into successive ~2-month cycles that also projected an early-Jan ‘22 peak (early-July ‘21 high – early-Sept ‘21 high – early-Nov ’21 high – early-Jan ‘22 high; see accompanying HCP diagram).
The DJTA was the most uncanny, topping in sync with a very precise ~2-month/~60-day high-high-high-(high) Cycle Progression – previously timing highs on the second trading day of the month in July, Sept. & Nov. ’21… and doing the same on Jan 3/4, ’22…
The German Dax Index set a double top in early-Jan, reinforcing that a ~19-year/5-wave advance is culminating…
Bonds & Notes remain in multi-week downtrends after setting divergent peaks in early- and mid-Dec. and triggering the onset of new declines. The failure (Notes) and fulfillment (Bonds) of weekly trend signals at that time projected multi-week sell-offs that could be setting initial lows now.
However, the overall decline from July ‘21 could stretch into March ’22 and fulfill an overlapping ~1-year high (Mar ’20) – low (Mar ’21) – (low; March ’22) Cycle Progression.
On a broader basis, Bonds & Notes are steadily validating the overall outlook for 2020 – 2023 in which interest rates have been forecast to slowly rise in response to developing inflation and other factors.
The Bond peak in July ’20 perpetuated an uncanny 4-Year Cycle that timed multi-year highs in July ‘12 & July ‘16 and preceding lows in mid-2004 and mid-2008. That cycle projected that interest rates would slowly rise (and Bonds fall) in 3Q ‘20 – 3Q 2022, possibly extending into 2023. Since that time, a ~1-year/ ~360-degree cycle formed a secondary peak in July ‘21 and could time a lower peak in July ‘22.
Longer-term investors and hedgers could have been liquidating long positions in Bonds & Notes and selling on intermediate rallies in 3Q/4Q ‘20… and should have added to short positions in Aug ‘21…
Gold & Silver remain above the lows set in late-Sept – when they fulfilled a myriad of cycle lows including Silver’s ~6-month high (Sept ’19) – low (Mar ’20) – low (Sept ’20) – low (Mar ’21) – low (Sept ’21) Cycle Progression. That low was forecast to hold for at least 3 – 6 months and potentially longer.
The price levels of those late-Sept ‘21 lows are the most crucial levels of 6 – 12 month support for Gold & Silver. These metals must remain above those lows if they are to maintain the potential for any additional upside during their current rebound. (A break, and weekly close, below those levels would signal a higher-magnitude decline in Gold and Silver.)
That is due to multiple reasons… While bottoming in late-Sept, Silver completed a 50% retracement of its entire 2020 – 2021 rally, reinforcing a developing range trading pattern with 21 – 21.50/SI as the midpoint and likely support (the 2015 – 2020 range was between 12 – 21 and the ensuing July ‘20 – Sept ‘21 trading range between 21 – 30).
That low was forecast to spark an initial rally into late-Oct and ultimately into Nov 15 – 19, when Gold cycles projected a multi-week top. Gold & Silver fulfilled that and, in the process, projected future peaks for Jan 3 – 7 – the subsequent phase of a governing 7-week cycle AND a ~5-month/21 – 22-week low-high-(high) Cycle Progression – and then for Feb. 21 – 28, ’22 – the ensuing phase of that ~7-week low-low-high-high-(high) Cycle Progression and an overlapping 17 – 18 month high (Aug/Sept ’17) – high (Feb ’19) – high (Aug ’20) – high (Jan/Feb ’22) Cycle Progression.
An intermediate high on Feb 21 – 28, ’22 would also fulfill an overlapping 14-week low-high-(high) Cycle Progression, which is why it is the more significant of these cycle peaks. A high in the second half of Feb ’22 would also fulfill a larger-magnitude, 49 – 51 week low-low-low-(high) Cycle Progression.
In the interim, pivotal support remains at ~1760/GC & ~21.50/SI.
Just like stock indices, Gold & Silver are validating the potential for the 2-Year Cycle to play a role (though not the ONLY role) in early-2022 action. As explained previously, there were/are multiple reasons – technical and cyclical – why Gold & Silver are set up to see an initial high in early-Jan and a subsequent higher high around Feb 18 – 22.
There are also several reasons why it could subsequently see a sell-off into late-March ’22. Cyclically, that is very similar to what transpired in 2020…
In 2020, Gold & Silver began the year by peaking in the first 3 – 5 trading days of the new year… just as they did in 2022. Gold then sold off for a ~week and bottomed before mid-Jan. ‘20. Silver extended its 2020 sell-off into late-Jan, creating divergence. That is almost exactly what has occurred (again) in 2022.
In 2020, Gold & Silver then rallied into Feb 24, ’20 and began a topping process. On March 6 – 20, ’20, they suffered sharp declines but bottomed within a month of the late-Feb ’20 peaks.
(In 2018, there were also some similarities with Gold & Silver rallying from mid-Dec. into Jan 4 before a brief pullback. They then rallied into late-Jan and ultimately into Feb 16 ’18 before a multi-week/multi-month peak was set. That was followed by a sell-off into March 18/20, ‘18, after which Gold rallied to new intra-year highs.)
In 2022, precious metals are set up for something similar… with regard to the timing of turning points.
They remain in sync with the same ~2-Year Cycle that has strongly influenced stock market action for many years and which projected a sharp sell-off in stocks in Jan ‘22.
One of the key factors looking forward, for the remainder of 2022, is where Gold & Silver peak (if they rally as expected) in the second half of Feb ‘22. As is often the case with precious metals, the final weeks of an up-cycle – leading into a potential multi-month peak – are often the weeks when an accelerated advance is most likely (90/10 Rule of Cycles).
The coming week(s) should reveal if that will be a realistic consideration in Feb ’22.
The XAU & HUI remain in a 1 – 2 year trading range (~120 – ~160/XAU) and are following a similar path as Gold & Silver, setting highs on Nov 15 – 19 that projected future peaks for Jan 3 – 7 and Feb 21 – 28, ‘22.
They remain on track for another rally into late-Feb ‘22 with the HUI diverging a little (just as it did when it led the way in projecting a major bottom for late-Sept ‘21) and indicating its high could stretch into early-March ‘22.
If it can extend a high into Feb. 25 – March 4, the HUI would fulfill a 41-week high-high-(high) Cycle Progression, an 11-week low-low-(high) Cycle Progression, a 22-week advance (2xs the prior 11-week advance) and a 5 – 6 week low-low-low-low-high-(high) Cycle Progression… a rally into Feb. 25 – March 4 would complete successive advances of equal duration.
Following that, the second half of April is the convergence of 5 – 5.5-month & 10 – 11-month high-high cycles that could time another multi-month turning point…
The Dollar Index corrected into mid-Jan. and to within a few ticks of support at 94.30 – 94.50/DXH (convergence of weekly and monthly HLS as well as weekly AND monthly 21 MAC support) – fulfilling its Dec. ’22 Intra-month Inverted V Reversal lower and setting the stage for a new leg higher.
94.30 – 94.63/DXH (the Jan ’22 low) has increased in significance as it is now the intra-year low and yearly trend support… as well as pivotal range-trading support (and resistance turned into support). That is the range where the Dollar peaked in 4Q ’20, before its final sell-off into early-2021, and where it initially peaked in Sept & Oct ’21 – before breaking out higher. The Feb ‘22 monthly 21 High MAC should remain in that range.
On a broader basis, the Dollar remains bullish on a 6 – 12 month and 1 – 2 year basis after bottoming in early-2021 while completing a 4+-year ’A-B-C’ decline and perpetuating an uncanny 38 – 41 month cycle. That should lead to another advance, stretching into 2023 – when an uncanny ~3-Year Cycle recurs.
The inversely-correlated monthly 21 MARC is pinpointing April/May ‘22 as another pivotal period when the corresponding monthly 21 MAC has the best chance at reversing higher. The action of the next 2 – 4 weeks should help build expectations for that future time frame. For now, the trend remains up…
Bitcoin is adhering to the 6 – 12 month outlook, spiking to new highs in Nov ‘21 and then entering a major corrective phase that was forecast to initially drop to 40 – 42,000/BT, then to 35 – 36,000/BT and ultimately to [reserved for subscribers] in 2022…
It just tested and held its second downside target (35 – 36,000/BT) and was forecast to set a new 2 – 4 week (or longer) bottom after dropping the same magnitude (~35,000/BT) and the same duration (~80 days) in Nov ’21 – Jan ’22 as it did in April – June ’21… A 15-month low (9/17) – low (12/18) – low (3/20) – low (6/21) Cycle Progression recurs in Sept ‘22 and could time the next major low.”
Bitcoin, in Nov ’21, fulfilled what its monthly and weekly trend indicators projected and what its overall wave structure necessitated – a surge to new all-time highs (~66,000+/BT) ushering in a major top in late-Oct/early-Nov ‘21. That also fulfilled the multi-year outlook for a major advance into 2021 when Currency War Cycles culminated and a ‘seismic shift’ was forecast to take hold as cryptos completed the expected culmination of a major bubble.
Since then, Bitcoin has been projected to plunge into Sept ’22 – when monthly cycles project the next multi-month low. Bitcoin’s unfolding sell-off is powerfully corroborating the outlook for 2022. Projected Dollar strength & equity weakness in 2022 could burden cryptos throughout the year and usher in 2023 – when a major solar storm is cyclically likely (see Oct & Nov ’21 INSIIDE Tracks). Rising interest rates should also pressure cryptos.
Coinciding with this, major stocks and indexes are completing multi-year uptrends with final wave ‘5’ spike highs (also in Bitcoin) fulfilled in Nov ’21 in key indexes and many leading stocks. The German DAX Index is signaling a related wave ‘5’ peak – the culmination of a 19-year bull market. That portends subsequent plunges to (at least) their 4th wave of lesser degree support – in 2022 and possibly 2023.
What does this mean for the future of cryptos?
Why is 2022 Bearish for Cryptos & Stocks (and Bullish for US Dollar & Interest Rates)?
Could 2023 Provide Massive ‘Challenge’ with Solar Storm??
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.