Dollar Nearing Bear Market Recognition Moment
The dollar is getting closer and closer to that recognition moment when the market realizes that a bear market has begun. It’s now making lower highs and lower lows. The next step will be to break the intermediate uptrend line. After that will come a break of support at 92. That should usher in some kind of waterfall event as all the trapped longs finally understand that the fundamentals are not bullish for the US Dollar. After printing literally trillions of them over the last 6 years I have no idea how anyone could – with a straight face – say the fundamentals are bullish. There has to be consequences to the Fed’s insane QE programs.
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So this could be bearish for European indicies? Looks like the DAX is reacting to the stronger Euro.
Not to mention the SDR reset that happens on October 1, depreciating the USD (lowering its rate in the basket) and the rumors about SDR as a new reserve currency.
I agree with Gary in the shorter term, especially when the US election uncertainty will gain traction. Trump is now far behind, Wall Street now thinks there’s an 88% chance of a Clinton-presidency, but there are a whole lot of game changers that can happen in the coming months (I wonder how low-stamina Clinton will do in the important debates).
while $USD was crashing yesterday miners were down for the day .. go figure.
the October surprise (short of new leaks) could be just a whimper.
already democrats are sweeping October surprise under the carpet and it has not even come out yet http://www.politico.com/story/2016/08/democrats-cyberhack-russia-lies-227080
closed my long-treasuries position opened yesterday; I dont like how treasuries react –> they need to complete their ongoing daily cycle.
I will resume my long-treasuries swing trade most likely tomorrow.
Getting closer to attractive place for pm stocks ?
I appreciate your write-up. It looks like next week will be do or die for the US$. I for one still think it will be the currency of last resort in this world before all currencies crash. Let’s wait and see what happens next week.
Alexandru: Are you aware that Dennis Gartman is now bearish on bonds? Given that he is almost always wrong, his bearishness is very bad news for the bears.
Gary, often market drop big post election so that incumbent could get reelected. What do u think?
The markets will be due for an ICL later this fall, but make no mistake, the 7 YCL is behind us and we are now beginning the bubble phase of this bull market.
All those trillions and trillions of currency units are going to cause another series of bubbles.
Here is an alternative view on US$. Very interesting take on what Rambus thinks is going on with the US$. If you haven’t read it take a peak. Something to think about. I believe the next week or up to the end of August will spell out the fate of the US$.
hi fb7777, read this piece before. Rambus same directional view on the dollar, not a different view…