Looking at the chart below it is obvious why we see the collapse in oil. But, how much longer can this last with the Gov’t printing billions upon billions of dollars?
Is this a head fake? or is the dollar for real?
Joined Jan 27, 2008
7,405 Blog Posts
It’s for real. If we’re doomed, the rest of the world is doubly fucked. Their socialist economies need the USA to carry their dead weight.
I think the dollar rally is for real. I’ve seen people mention that bull/bear markets in the dollar tend to last many years, like 7-8 years or so.
Also, I think that people are expecting the US to be the first to come out of this economic crisis/malaise/recession.
So many have called for total destruction of the dollar with the bailout package and the constant infusion of currency into the financial markets. However, what we are seeing is the total oppposite of that in the forex markets.
I think this is the end of commodity cycle, and start of dollar and equity cycle.
I think it’s a head fake by a significant portion of the USD holders who wish to dump their dollars in an orderly fashion.
Also, any correlations between equities and the dollar are not to be trusted. Too much weirdness going on in the fundamentals for the technicals to make sense.
On the other hand – UUP is a nice three month trade from where I’m sitting. Just keep a close eye on it so it doesn’t melt down on ya.