Kevin Wadsworth and Patrick Karim: Charts Point to the Endgame for the Dollar
Tom welcomes back the dynamic charting duo Kevin Wadsworth and Patrick Karim. They highlight some rather alarming charts while making market forecasts that are quite concerning.
Kevin discusses the breakout in European electrical prices and natural gas. He believes this is a clear indication that hyperinflation has begun. The U.K. has had a four hundred percent move in electrical prices, which is unprecedented. We see the same thing with natural gas. If you calculate from the March 2020 region, we are up 4600 percent and 320 percent above the previous all-time high. The charts have been hinting for some time that something bad was occurring.
Inflation has been building for some time and the idea that it’s caused by the current situation in Europe is laughable. Patrick explains how gold sniffs out future market action. Gold had a big move in the past couple of years, which necessitated a period of sideways consolidation.
The U.S. and German PPI indexes along with oil are reflecting a paradigm shift in global markets. All fiat currencies are trending towards zero.
Kevin looks at the dollar index and shows us why he expects a rather sharp decline from here. The seven-year rate of change for the dollar looks very bearish and maybe a better indicator than price alone. They believe the dollar index is now due for a sharp decline. The inflation-adjusted dollar chart shows a steady decline following a long-term trend channel.
Be prepared, when the dollar declines and most investors realize it, you will want to be ready for the big move in metals.
Commodity currencies like the Australian dollar appear poised for a breakout versus the US Dollar.
The miners appear to be out of a rough patch and now we’re heading toward a final breakout line. Now is an excellent time to be buying silver to protect your purchasing power. Anyone making minimal wages is losing purchasing power rapidly.
Patrick shows several charts including a possible road map for gold. It appears that it was about to break into a new seven-year-long bull phase. Take the big picture view and consider buying into weakness.
Lastly, they discuss silver and where the rate of change indicates we could reach the coming bull market.
Time Stamp References:
0:00 – Introductions
1:20 – Technical Analysis
3:40 – UK EU Energy
9:15 – Golds Predicative Powers
12:32 – PPI Indexes & Oil
19:37 – U.S. Dollar Index
25:38 – Commodity Currencies
26:43 – DXY Inflation Adjusted
34:47 – XAU Miner Ratios
37:22 – Metals Vs. Wages
44:28 – Pitch Fork Levels
45:07 – Gold Log. Road Map
47:32 – Cycle Charts
57:28 – Silver & Gold Targets
1:04:36 – T.A. & Probabilities
1:07:08 – Wrap Up
Talking Points From This Episode
- Electricity, natural gas, and hyperinflation.
- Current causes of inflation and PPI indexes.
- Why the dollar index seems poised for a significant decline.
- Outlook for precious metals and other commodities.
Patrick Karim Guest Links:
YouTube channel: https://www.youtube.com/patrickkarim
Patrick Karim is a proprietary capital manager and chart trader since 2006. Patrick’s background in commerce, psychology, and an ongoing career in systems engineering has allowed him to evaluate trading scenarios systematically.
His psychology background helps him understand the human factor: overcoming stress and maintaining a successful career.
Kevin Wadsworth has a background in meteorology, having spent over 25 years in military and civilian weather forecasting. Over the years, his career has involved everything from briefing pilots to producing commercial advice to utility companies and providing TV and radio broadcasts. His current role is as a Civil Contingency Advisor consists of linking with the emergency response community. He gives advance notice of life-threatening weather events and advice during events influenced by the weather, such as wildfires and industrial accidents.
The science behind weather forecasting aims to unlock methods and techniques for predicting the future with ever-increasing accuracy. A friend and colleague helped spark an interest in the global economy and the financial world in the early 2000s. The financial crash of 2008 got Kevin hooked, and he gradually became aware of the similarities between forecasting the future weather and forecasting future price movements in the financial markets. Around that time, he read an abridged version of Strauss and Howes ‘The Fourth Turning’, which intrigued him.
The cyclical nature of markets mirrors the cyclical nature of the weather and seasons. The process of gathering evidence via multiple computer models that assess the likelihood of all possible future outcomes works just as well for predicting the future price of gold for indicating whether it’s likely to rain on the weekend or not.
His focus is on tuning out all the noise and presenting clear and uncluttered charts while gathering all of the evidence. Kevin tries to have no bias but instead follows the weight of evidence. He says, I’m not a bull or a bear; I’m simply presenting the evidence as I see it.