The stock market is now entering the timing band for a move down into a daily cycle low. Today is the 29th day of the cycle and we usually get a final cycle bottom by day 40. Of course we need to allow some time for the decline to unfold so I think we can expect a top any day now.

The move down in stocks should coincide with a bounce in the dollar index as the dollar is already moving into the latter part of the timing band for its daily cycle low.

Since gold has been tracking the dollar almost tit for tat I expect the rally in the dollar to also pressure gold down into it’s daily cycle low which is now due.

The miners have now joined gold and silver at new all time highs. (Well silver isn’t at all time highs but it is at bull market highs.) The entire precious metal complex is now trading in a vacuum with no overhead resistance. This is the only sector in the world that can make this boast.

Needless to say this is a very bullish configuration and one that should lead to massive gains the next 6 months as the dollar collapses down into its 3 year cycle low.

The risk now isn’t that we may get a pull back, although we certainly could. No, the risk is that the miners may never trade back below the breakout level again for the duration of this bull market.

Anyone waiting on a pull back to enter runs the risk of missing the entire move because they couldn’t adjust their thinking from trading range mode to break out mode.

Most people have a lot of trouble buying anything when it’s in an overbought condition (they have trouble buying when it’s oversold too). Unfortunately virtually every breakout occurs from overbought levels. This is especially true during a powerful C-wave advance.

Take a look at the last two C-waves and the first leg up in the current C-wave.

You can see that each one of these powerful rallies when it broke out of the trading range had already reached overbought levels. Then it stayed overbought for most of the rest of the rally.

If you didn’t buy the breakout you missed a huge portion of the C-wave as no corrective move retraced back to the breakout point.

One of the biggest mistakes investors and traders make is using oscillators after a breakout has occurred. Oscillators are great tools if an asset is in a trading range. Once that trading range gets broken though one has to throw out their oscillators as they will cause you to miss huge portions if not all of the move.

Now let me remind everyone that Bernanke clearly stated he would print money if the economy didn’t improve. We know there is no way the economy can improve because we still don’t have the next “new” industry to drive job creation.

Folks this one is a no brainer. The Fed is going to print. That is going to cause asset inflation. The dollar is going to drop down into a yearly and three year cycle low. And the market is going to make Bernanke pay for his insane monetary policy with at least a mini-currency crisis in the dollar by next spring. And ultimately it is going to cause general inflation in all prices with the possible exception of real estate.

Gold is likely now in a runaway move higher. Smart money is using any and all pullbacks to get in ahead of the inflationary storm that’s coming. We saw it in the action yesterday. Gold briefly traded down to the $1300 level and miners briefly tagged 500. Buying pressure immediately came in at those levels.