I see you!
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Despite the best laid plans of mice and men, not to mention Time Magazine weasels, physics still work and even fiat currencies bounce. We are experiencing a necessary breather here in the nine year plunge of the dollar, otherwise known as The Potemkin Bull.
Here’s a hint as to where I think we’ll be going in the near term on the dollar proxy [[UUP]] :
Before you get all excited about your extra-ursine activity however, just know that this is not likely to last for very long. Give it a couple of weeks, tops, before Time’s Genius of the Year presses the one button he’s made available to himself to guide us all to economic Valhalla.
That would be the button that attaches to the dollar printing presses. For those of us who’ve been following the path of Jackson, that will be our signal to start buying miners and royalty plays again, this time in size. In the meantime, I’ll be over here adding a little more [[SPY]] puttage, maybe some [[TZA]] and a couple of dollops of [[DUG]] for (just) deserts. If you are in The PPT already, you will see the purchases first, as you have been.
If you are not, then “a ha’penny will do,” I guess. Off to listen to the sounds of “fap-fap-fap-fapping” coming from the Dope Slope. At it’s crescendo, I will be buying gold, glorious gold.
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Do you trade currencies? BTW, look for gold to have many more commercial applications in the coming years.
No, I only trade commodities with an eye towards how strong the currencies of the respective currencies from whence they came are.
I look for gold’s primary app in the coming year is as an anchor to a basket valuation for a stronger currency, which may or may not be the dollar.
When all this washes out, people are going to have a hard time believing in fiat again.
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That would be an interesting thing to have a dinner conversation on. How easily that could be accomplished…I wonder.
I think the global economy is trying to rebalance the value of goods and services with respect to one another not just fiat.
Careful with the insults Jake, TK throwing down the gauntlet.
Huh? What gauntlet?
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What’s your timeframe for the shorts? I think oil here could see the $69 bottom broken with the next wave of the dollar up-move.
I would not be in oil here, just as a precaution, and as you know I dumped all my ERX and most of my longer term oil longs a couple of weeks back (still hold a little OXY and PBR, as they are gems).
That said, I think we have three weeks, maybe a month of pullback before the presses get humming again.
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Interesting notes from “the Professor,” Fibonacci —
DXY breached the long term** 23.6% first fib this morning (at $77.82) and then fell below it again. This could be the extent of the move for the time being (ie, this week), as that’s a significant milestone.
If we manage to close above that fib line, I’d look for a bounce back to it, and then we should head all the way to the 38.2% retrace at $80.07.
That should sufficiently scare all the “permanant” out of our various boastful — if shaky– bulls trying to keep any king kong sized gains this year.
After that, we return to our bullish ways, weighed down with PM’s once again.
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UUP also seems to be having some trouble getting over $23. As you may recall, $23.05 was my previous “support” line that was recently breached in our most recent rally up. If we broach that, we should have a similar mini-rally in the dollar proxy as described above.
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** (1 year chart, from the 3/04/09 high of $89.62 to the 11/26/09 low of $74.17 )
One more thing — there is a gap to fill from the 9/09 dollar plunge (previous day’s close at 77.98), so that would also make a very logical “rest period” for this dollar rally.
Trade accordingly.
Professeur Fibonacci.
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Added bonus — 38.2% near term fibonacci line** for GMCR?
$68.10
Significant if it breaks this line on the daily, moreso if it is repulsed there.
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**(near term fib chart = $79.23 high on 10/20/09 and $59.60 low on 12/04/09)
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Buying DUG for deserts? Did someone drink the Arab’s milkshake?
Play on “just deserts.”
As in “getting yours, buddy.”
Turn of phrase, as it were.
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In case you were thinkin of the other “dessert” — this is a not uncommon mistake.
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Mine was double entendre. As in short oil, fuck the Arabs in the desert and drink your milkshake as in the dessert and the “There Will be Blood” reference.