Could it be? Could USD actually obey the chart guy and fail right here at the SMA 50, the 62% retrace level, RSI & MACD 'resistance' areas and our 'B' leg of an ABC down that mirrors the previous ABC up? The dollar is making such pretense in pre-market as a world full of would-be recovering gambling addicts celebrates another bailout (additional $20 billion for Bank of America plus $118 billion more for 'troubled' - AKA garbage that these supposedly buttoned down institutions enriched their higher ups with while as a collective, destroying the United States through hubris and greed - assets on the books).There is a lot of trend following going on in the dollar lately. The deflationists are out again everywhere, clubbing people over the head with the obvious fact that the US is imploding. Again, the deflationists have been quite right in many ways as fear drives the herd to seek out and save dollars and pay down debt. But, in the big picture there is something rising out of the wreckage and that thing is likely to be very nasty. They are going to fight deflation tooth and nail because deflation will destroy the trough that a bankrupt political system feeds on.
It is the fighting of deflation that I am interested in. Two huge forces going at each other. Have you looked at LIBOR? TED? Various money supply measures? The deflation masturbators and inflation fornicators can obsess on their ideologies all they want. What we want is to be right because our financial survival depends on being right. The dollar went up... the dollar went down... the dollar went up again. Now, our plan is that it goes down again, far enough for the trend followers to begin trumpeting its demise. Then we'll evaluate further.
But first, we need to confirm weakening momo and get a couple closes below the SMA 50 before we can confirm that our 'B' leg has topped. Yesterday, as the dollar sagged and the various markets began to stabilize, I bought back a bunch of the previously ejected stuff. Let's see how it turns out. The EMA 20 on the $CPC is still not where I would like to see it and the HUI is still within an orderly decline down to support. But considering this stuff was ejected up around HUI 300 and at the broad market SMA 50's, I do not want to get too cute. I always seem to sell a bit too soon and buy a bit too early. But it usually works out with patience.
You do what your MO dictates but for the love of Jesus, tune out the bullhorns and think clearly.
