Dollar Rally

Wasn’t the dollar supposed to crash … go to zero … implode?

This is the flip side of the hyperinflation narrative.

Dollar implosion like hyperinflation, not happening.

Way back in 1921, Livermore said to Wyckoff that his assessment of the markets was, ‘it’s all about deception’.

Nothing has changed.

It’s in the best interests of those controlling the narrative to have as many as possible (always) on the wrong side of the trade.

We haven’t posted this link in a while … the video keeps getting deleted but re-appears every so often. This is how it really works … Period.

Note the date stamp on the comments. The video’s at least 13-years old and it’s still relevant today.

So, the dollar’s in a rally.

Not only that, momentum indicators, MACD, on the monthly, weekly, daily, all point higher. It’s in a rally and a sustainable one.

It’s completely opposite the accepted narrative.

You can feel the tensions building.

Bonds could be reversing but have already pushed rates high enough (long enough) to choke-off critical sectors of the economy like here and here.

Now we see the dollar has bottomed as well.

It looks like a strong multi-month (or year?) rally. Correspondingly, gold is weak. The overall markets are stretched to ever-livin’ extremes; never before seen.

Whenever this baby pops, try logging on to chaos, or exit any position (except maybe for the long bond).

Our approach then (not advice, not a recommendation), is continue work on positioning short. So far, the ‘project’ is taking small hits in those attempts. We’ll see how basic materials (SMN) works out today.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

Silver Short Squeeze, Over

Massive volume in SLV, points to significant reversal.

Not since the week of May 13th, 2011 has there been higher volume.

The week prior in 2011, was the highest volume ever, for SLV at 1.1-Bilion shares.

Those two weeks culminated in a crash over -31% and were just after SLV reached its all-time high.

Total down-draft for the three weeks combined (the top and two weeks following) was nearly -34%.

Will it be any different now?

Probably not.

At this point, it’s important to re-state, this site is following principals and techniques set down by three market masters of the early 1900s; Livermore, Wyckoff and Loeb.

Markets do not change. Using the techniques outlined by those early masters are still applicable today.

Arguably, the father of technical analysis was Wyckoff.

The terms “accumulation, distribution, support and resistance” originated from him.

His technical publications had the largest subscriber base in the States at the time; larger than all other publications combined.

At one point he got so successful, his buy or sell recommendations were beginning to move the markets all on their own. The year was 1918.

Instead of stroking his ego on how ‘his recommendations’ were affecting the markets, he saw it as a disservice to his clients.

In May of 1919, he discontinued his newsletter publication ‘The Trend Letter’. It had become so popular, it was impossible to provide recommendations without those same tips moving the market.

What a contrast to today.

Those attempting garner forces (the little guy) to move the markets, such as silver, will find out soon enough who’s in control … and it’s not them.

It’s unlikely silver is going higher any time soon. There could be some upward spasms as the crowded trade exhausts itself; it’s likely we’ve seen the SLV highs for quite some time.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

Big Money, Big Move

The big money is in the big move. 

One recent example; the bond move from late 2018, to early 2020.

During the low from October 2018 to November that year, were reports of professionals opening huge long positions. 

At the time and as the weeks went by, it appeared that nothing was happening. 

The delay would have caused the typical i-phone addicted ‘tweeter’ to lose interest many times over.

When it finally took off, bonds staged a huge directional move that lasted over a year.

Such moves are rare and require the ability to wait. Wait to get in and wait for the move; minimize transactions.

Each market transaction is an opportunity for error.  Minimize the transactions and by definition, the errors are minimized as well.

That brings us to oil and more specifically, XOP and DUG.

The nonsense being promulgated by the financial press is that oil is moving higher on ‘hopes’ for an economic recovery.

Maybe injecting the world-wide population with potentially DNA altering technology (not even tested on animals first) for an ailment that does not exist will miraculously launch some kind of pent up consumer demand.

No matter. Oil and its attendants keep moving higher with the dollar moving lower.

Even with anecdotal evidence from an Oklahoma oil field worker (commenting on a Van Metre update) that was later confirmed by the EIA report did not cause oil to move lower … yet.

That is, until today.

The dollar attempted to continue its downtrend yesterday.  Oil spiked as did XOP to the upside and DUG to the downside.

This morning is a different story.  Dollar proxy, UUP is trading (pre-market) right at its highs of the last session in an apparent reversal. 

Oil along with XOP is down, with DUG up.

Looking at XOP, we see it’s hitting a long-established trend line. 

With the dollar, bond, and overall market extremes, no recovery in sight and more probable, another (and complete) collapse; this may be the spot (not advice, not a recommendation) to position for medium to long term on the short side.

That’s exactly what the firm has done.  Looks like our position was a day too early as we sat through yesterday’ spike lower in DUG.

Volume remained heavy for that DUG session. Weekly volume is looking to be the largest (big-money moving in) since at least 2015.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

Get Right … Sit Tight

That was Livermore’s adage nearly a century ago.  Find conditions for a sustainable move and get in.  Then wait and wait some more.

Going on, he states that is was not the thinking that made him money … it was the ‘sitting’.

The short entry on GDX was initiated with DUST (2X Inverse, GDX) at DUST 18.86.

Initial stop (not advice, not a recommendation) was very tight at the session low, DUST 18.45. 

Price action the next session (yesterday) pulled away from entry levels and the stop was moved to 18.56.

Today’s pre-market session (8:54 a.m. EST) shows continued downside for GDX, with DUST up correspondingly. 

If there’s a higher close in DUST, we’ll move the stop again.

With the overall markets, S&P 500, Dow, NASDAQ, at or near all-time highs, the precious metals sector seems to be leading the way lower.

If the rest of the market reverses, downside action in the mining sector could be dramatic indeed.

In other markets, it appears that Peabody Energy (BTU) may have finally found its low; from top to bottom, a -98.33% decline. 

Analysis of BTU to be forthcoming before the end of the week.

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.