You guys are the ones I trust most to navigate the waters of Lake Wtfisgoingon, but it seems to me in reading the last few days posts that there's been some disagreement about how this whole thing shakes out with the sovereign debt crisis and its effect on PMs. Could each of you chime in if you have the time to give the rest of us peons your read on the next few weeks and the longer term outlook?
Thanks in advance, Riles
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One of the main advantages of fiat currency is that the currency can revalue as the strengths and weaknesses of the country’s economy evolve, allowing for adjustment of the currency to reflect the underlying economic fundamentals. That is the trade. Trade the channels. I still stand behind 10 different posts about the conditions and possible outlooks including Europe and the future US dollar. I do not in total disagree with YDM about Europe. It is all about Germany. Other nations are afraid to set in and help because Germany keeps changing their read. I just wrote about the pros and cons with what decisions that is facing Germany.
Read the Daily FX under Yahoo finance news. Read the article about "Price Channels." I am often involved with the Daily FX website.
We will have up days and down days. Trade with the currency channels. Europe is in trouble, but so are we and the rest of the world. I traded the dollar strength as mentioned. In time, the US dollar will also fall very hard. I may be writing a piece with others about Europe and and the reaction to currencies. In 2012-2013, gold and silver may see new highs. In the longer term, silver and gold will rocket to the moon. Growth is an internatinal problem. Debt will continue to increase. I posted reasons why gold and silver have fallen a few days ago. From that, and stated in that post concludes that in the future solid money will be placed into silver and gold. Hedge funds, mutual funds and leverage holders needed to sell silver and gold to cover losses and margin requirements.
Still, we should take all of this with in a so so fashion. I expect any additional currency buying to be very well capped into the next levels of resistance. I would continue to watch the longer-term charts. The Euro is looking like it is rounding out a major lower top below the record highs from 2008, additional weakness in the currency towards 1.2000 is in my forecast over the coming months. The play today is NZD/USD. The 30 year bond broke 77.00 as money flow is the obvious reason.
This morning at 3:00 am, the dollar spot made a move to 77.537 exactly and bounced with little enthusiasm, then the next move IMHO signifies how important 77.54 was. Typically only failures of a trend have such a massive move, either that or headlines. The index fell through by 0.75 which was massive numbers of stops being triggered and sending it down.
The spot isn't as important as Dec 11 dollar index. It failed at around 4:15 am. So, now it's wait and watch to see if the index will remain under the mark or bounce to touch it. It needs to close under the mark for a day or two to signify the dollar bullish move has died - for now.
Riles: I think that you have excellent skills. You are very smart and post very interesting stuff. So do all others.
I knew that SLW would end up today. I use currencies with money flow and a few other factors. I often do give one day or longer outlooks. If you look at my 4 year history, I mostly get the short term right. Again, no credit to me. Credit my systems. If I deserve any credit, it is because I know how the banks and market players work the game. I have spent many years in grad schools and I have a lot of CERTs. My degrees in logic over my degrees in economic makes a bigger difference in my trading. I had the best in economics as teachers. Also my former employeer is the best consulting firm in the world. I keep a record of my short term calls for myself. I am 94% correct. Once again, credit my systems not me. I said that when SLW was under 3, that it would go to 50 in 3 years. I said sell when it hit 47, mostly because of hype. I also have said sell a few times along the way and then to re-enter.
When my yahoo email was active, I had received dozens of thank you letters. The funny thing is that none ever really posted on this board.
Thanks for the compliment. I'm no dummy. I've got the masters degrees too, but in my line of work I don't stare at charts and therefore rely on others to do the work, post their methodology or reasons for coming to conclusions, then make my own informed decisions. Most of the stock guys I've had in the past are no better informed than I am so I look online for sources that I trust based on track record. I know about yours...I've actually been following you and the other two for some time, albeit quietly, and trust your respective judgments based on the quantitative and qualitative reasons given to support conclusions. However, it seems lately there's been some disagreement.
What I'm most interested in at the present time is the short and long term outlook for PMs and currencies, and the reasons for part-timers like me to believe. Right now I feel like a fence sitter and want to jump back in, just uncertain about when and where to do so.
Again, thanks for taking the time to chime in.