(Due to a very late night at the office, the only correspondance tonight will be Haiku)

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Dollar bends to lows

Chuck and Fly Hoist Silver Cans

Toasting the Bernank

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Bernank spreads the gelt

Like bread upon the water

No Cat calls, Kettle.

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True Gelt responds not

To Aegypt’s mad ovation

For hunger and pain.

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We’ll wait this week out

To see which way the wind blows

Toward, or away.

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No changes, today, save an addition to my QID horde and a sale of one quarter of my remaining ANV, on strength.  I may consider more DXD tomorrow, depending on what the dollar does.  I may say “no mas,” too.

Best to you all.

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Unsurprisingly, gold and silver are not done bottoming, as per today’s evidence, and to my favourite Kansas Cityan’s temporary chagrin.  And like the dollar reflects the value of gold and silver as it crashes, so gold and silver serve as lodestone for the direction of the dollar. 

See, gold taking a bloody digger like it did today is not consistent with a plunging dollar.  Quite the opposite.  And remember that daily silver chart from just a few days ago?  Here it was:

Those were the predicted directions.   Now, let’s look at the same chart as of close today:

Wacky, no?  We reversed almost completely the pop we had the day before, and gold did worse, achieving recent near term lows for 2011.

It might get even worse, so hang on, and deploy capital sparingly.  I have added to my ZSL  about two hours before the end of yesterday’s session.  I felt a pained fool at the time… “but I got better.”

Here’s what I’m really getting at.  Take a look at this very large Fibonnaci Retrace on this almost three year dollar chart :

Now I realize the above chart is a bit busy, almost akin to the Punch Buggy Post we had the other night.  However, you need only take into account a couple of things.  First, we are hovering almost exactly at the Golden Ratio — the 61.8% retrace of the  large dollar move from the depths of the last Bernanke dollar destruction in March of ’08, to the peak in early March of ’09, when the market bottomed.   This is a significant resistance point for the dollar, in my opinion.

Second, we are also very close to the rising trend line in the dollar.   I believe the dollar is far too oversold to break the longer term trend at this time, unless of course Bernanke just starts shooting Benjamins out of cannons on K-Street tomorrow afternoon. 

So, if by chance that very strong Fibonacci line does not hold tomorrow, then I believe the uptrend line will in the next few days.

Whichever the case, we should get a snap back in the dollar, no matter how brief.  I think we see at least a 5-7% correction out of  that dollar, which will likely include our miners.  I may lay some more DXD, QID, and SDS at that point.

I also think our miners will rebound first, so be ready to start collecting.   Best to you all.

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…………………….And get in the Funnel!

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No more screwing around funnel dogs, you’ve had your play. Now it’s back in the funnel with all of you.

I added some DXD today to my egregious whip of S&P and Russell 2000 short ETF’s. Why? Because the $INDU weekly chart is as overbought as I’ve seen it in the last five years.

Take a look at this weekly:

Sorry this is an abbreviated post tonight, but I’m having a hella time seeing and saving what I’m putting into the blogging box. Could be some antepasto was spilled on the server, or maybe it’s WordPress, but I’m getting out while I’m ahead.

This is your time to hedge up. Continue to sell here, raise cash, and Saint Francis University.

Best to you all.
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