Betting against the US Dollar

Quote from Nine_Ender:

The price of the underlying denotes its class. Multiple position will not save you IF the risk trade comes off. I'm not saying it will happen only that its a lot more likely then you seem to acknowledge.
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Are you aware of the impending doom on the financial markets?
I am assuming no.

The Dow and the spot price of gold will reach 1 to 1 probably about $5000-$6000oz and the dow being 5000-6000. You can expect the big banks to be 0 in the near future.
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Scott J
 
Quote from Shagi:

The dollar is at a cross-roads, a major move imminent either way .

If it rallies from the range commodities rise will be checked.

If it collapses which is unlikely at the moment as there is insatiable appetite for $dollar assests currently with highest yeilds of any currency and in the interim yeilds have room to move up.

The 10 year yeild currently at 3.35% is going to 4% by end of next month.

Its a tricky one. Dollar gaining against other currencies but commodities still on a bull footing?? Who is fooling who????
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I believe that once the Euro crisis is over the attention will turn to the US. The dollar is only gaining against other currencies now because we are the lesser of the evils. Really it is a race to the bottom. We are the next shoe to drop. Of course the yields are going to 4%. It has to in order to attract people. That high yield is directly correlated to the uncertainty and risk involved in being in the dollar. QE3, 4, 5 is coming. States are about to fail and go bankrupt - i.e. California, Illinois, etc. I'd argue that would drive up yields and commodities.
 
Quote from Shagi:

The dollar is at a cross-roads, a major move imminent either way .

If it rallies from the range commodities rise will be checked.
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One other thing to note. If you take a look at the DXY (Dollar Index) on a given day there are plenty of days we have strong rallies in the dollar without corresponding declines in the PMs. The PMs are beginning to decouple from the DXY and it is becoming increasingly irrelevant - again because we are only appreciating relative to other bad currencies. It is not a vote of confidence in the dollar.
 
Quote from illinimatt81:

One other thing to note. If you take a look at the DXY (Dollar Index) on a given day there are plenty of days we have strong rallies in the dollar without corresponding declines in the PMs. The PMs are beginning to decouple from the DXY and it is becoming increasingly irrelevant - again because we are only appreciating relative to other bad currencies. It is not a vote of confidence in the dollar.
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You might want to look again. Just about every major currency that been gaining against the dollar has topped out if its priced in foreign currency i.e GBP/Euro/AUD/ etc and bottomed if priced in USD e.g JPY/CHF. The stronger currencies should be battering the USD like NZD/AUD/CAD/CHF but they say otherwise. The weaker ones EURO/GBP are as good as finished.

The DXY is more likely to rally to 85 within the mext 2 months. And historically where there has been a convergence between DXY and commodities ( Commodity Index) the net result was divergence in favour of DXY direction- based on the evidence I see I dont see this changing soon.

In other words I'm long USD in currencies and neutral in commodities expect those that are not strongly correlated to USD movement like - Cattle, Sugar, Coffee,Cocoa, Cotton etc. Its the metals and energies groups that are more likely to fall off the cliff soon. Lets see how it plays out I could be wrong but until then ........:D
 
Here is something interesting - On the weekly chart you will notice that from November both DX and commodities having been rallying - convergence. Its not going to last long after close examination of movements of individual commodities like Gold/Silver & Currencies etc.

The red is Commodity Index & Green is DX - weekly
 

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Quote from illinimatt81:

I'm not going to reveal my positions as I do not want to run afoul of ET rules on discussing penny stocks.

I did my DD on these. Without knowing the symbols how do you know only a few of these are legit juniors? I really don't see where you can draw logic of them going belly up if silver continued to climb. The only plausible cause of any of these having that happen would be nationalization of mines, an accident, gov't issues that come out of nowhere etc.

That is a risk that is taken and hedged against by having multiple positions.
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Ok, you are overdue for an update. I am curious how the junior crew of silver miners made out the last week because on the surface that risk trade selloff seems to be in the early stages of happening. Whether you understand or not, you are not hedged at all, your portfolio will either quickly make a lot of money or lose a lot of money daily, and the losses will be premarket without warning.
 
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