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Dollar Back To July Levels As Euro Crushed, Futures Support Taken Out
Who would have thought that the much anticipated European contagion would actually arrive. It was priced in right? Algos and correlation desks are flabbergasted that this is one situtation that the Fed apparently is helpless with. And if it does, it would only be dollar positive and stock market negative. Indeed, regarding the first, the dollar is now back to July 2009 levels.
Regarding the second, ES takes out the 1085 support to the downside with much conviction. We have previously discussed where next technical support levels are (hint: lower).
And in an attempt to stop "rampant speculation" JPM is out with a note seeking to stop the profit taking on what will certainly end very badly out in Europe:"[We] do not see contagion from the Euro area impacting [emerging market] sovereign funding strategies in a meaningful way" Zero Hedge in turn sees the contagion from the Euro area impacting JPM's business prospects in quite a few meaningful ways.
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die spx die
die
lmfao at longs
is Andy giving that big ol' bear snoozing on the stump a second cup of java this morning? mebbe a nice stong European blend espresso?
Chopshop, do you see any mystery buyers trying to prop S&P? They'll need a few more quarters for the juke today, huh? Whoopsie, just boinked to 1076. Getting interesting.
Roasting: not good to trade emotionally...just sayin...
Good riddance USD bears, been good knowing ya. Keep holding and averaging down into your beloved EUR longs.
Hey, fader, you dropped a pom-pom.
Uh! Just a suggestion, but you might just want to look at the COT Report and pay particular attention to what side of the boat has all of the Commercials.
I wonder how the dip buying is going today.
Just ask Leo... :D
Buy the chinese solar stocks! ;p
To be honest, I interviewed to be a staff accountant with a local solar company here, and they didn't even have an accounts receivable department, but they had one helluva A/P department.
The only thing that bugs me about solar is that it's not a really opportune time to buy for the photovoltaics to be included in new construction (there really isn't any) and people surely aren't making upgrades to their houses right now.
I just don't see any upside to the solars in the near term... unless it's based on speculation.
From a purely fundamental standpoint, it'd be the worst trade on the planet.
John has a long mustache.
So...it's a go for tonight.
See you in St. Lo.
Oh and don't forget to buy some more gold today! It's on sale. Can't go much lower! Once in a lifetime chance before it goes to $5k as the USD becomes worhtless, right? LOL Morons.
Quck the ocean is rolling out theres fish flopping around in the muddy bed. Go out and pick some up. U'm I'll be over here doing some mountain climbing. For exercise. Ya just for excercise.
thats a good one! does he know that we had to stop payments on the Tsunami warning horn? We ran out of funding.
There is no such thing as a 'sale' on gold - insomuch as there is no such thing that the 'price goes down'.
Gold just is a store of value, nothing more.
Oh wait... Crap, now I am confused...
spot on. and as far as the sale, it is on! buy buy buy!
I think that it will probably take out the 1220 SOMEDAY, just not soon.
Damn, it already broke its 1080 support today. I was right yesterday in my posts about the descending triangle not holding up for one more test of 1080.
Well dur you can take out support for gold easy. What you can't do is keep it out. So where is it heading tomorrow and friday? Right back towards 1100 given that whatever was expensive and broken and needed to be paid for today is done being paid for.
Maybe you haven't seen gold's chart today... it sure isn't very bullish. You might have a retest of 1080 to the upside, but that resistance got whooped.
Hate to say I told ya so, but...
And no, you can't take out the support for gold easily. The 1080 held for weeks before it broke down. Of course, I've been saying that it was going to break down the entire time, getting my posts flagged as junk by asses like you.
Look buddy, I have nothing against you, but it seems like you need to realize when you're wrong. In this case, you're pretty wrong.
I wasn't flagging your post as junk. I honestly thought they'd have it down to 980 by now and I really didn't think 1080 would hold that long. Because this is do or die. This isn't a normal thing you are seeing. It either gets done or it crashes. It's a pretty weak fight actually. I hoped Project Mayham would have gotten his 1320 by end of the year but he's going to get his 1320 it won't be much longer.
People are looking at comex and this is all they can see.
http://www.mp3lyrics.org/s/saga/promises/
Okay, then I believe you. Sorry to call you an ass.
I thought 1080 would hold for three tests because it had a descending triangle pattern. It held for two tests, and broke through on the third.
I wouldn't say that the flight is that weak. I mean, it's having it's downturn.
I also thought that we'd see gold in the 1300 area, but it didn't even make it there. I think that that action bodes bearish for it.
Gold has low volatility compared to other asset classes. I think that we'll see some more downside before we see an upside, but I do agree that we just may see that 1300 eventually.
Yup I thought it would hold too and never break. But I didn't think the crap that is unwinding right now would unwind right now. I thought it would get all stuffed in a dark corner and then dragged out in april with one more oh look how great things are going!!! push to fantasy. But I guess reality confrontation is going to get stepped up a bit. God must be out of liquor.
told you so? you make me laugh...at you.
told you so? you make me laugh...at you.
So it looks to have broken the first support level. However you are not telling all the facts. You better start telling all the facts. The $1080 support level held. Then stocks went up. This proves that $1080 support level was REAL and if you try to deny that I will think you are a fool. So now it brakes support, so what? The markets are a bunch of BS like BS Bernake is "in charge". Now we get to test the $1040 support level. This level will be the BOTTOM. Then hyperinflation will comence as we start QE Dos (jobs program). I am monitering your posts btw, and have noticed you are not telling both sides of the story. Tell both sides, please.
The SP500 highs of 1550 (or whatever) will also get taken out, at some point. Just knowing something will go higher doesn't mean one can make money trading it.
Maybe in the year 2060! LOL. No, I'm just playing. It might be sooner than that.
Assuming your a trader. Some of us aren't. We make money other ways. Some of us are successful at that and build wealth. We don't want to buy and sell anything today, tomorrow, next week or possibly for the remainder of the year. Where do you suggest we hold our excess wealth in this environment? Markets are funny things. I do see a possibility that the dollar and gold could both trend higher.
I don't think you understand--the idea of long term buy and hold is a marketing concept.
I gotta say that I was wrong about one more bounce before the whoopin in my posts yesterday. This proves even more bearish than I had anticipated.
To anybody who listens: I WAS WRONG ON MY CALL ABOUT THE S&P TODAY, SORRY!
I was spot on about gold though.
Uh! Paper Gold or Physical Gold?
To me, I was referring to physical gold. I see a descending triangle on the chart, and I think that it will probably blow through the 1080 support pretty soon.
You have me totally confused. The demand for physical gold is at all-time highs, with shortages being reported for orders-in-quantity. Substantial premiums are also being paid to secure physical gold.
Do you understand the difference between paper and physical?
GLD is the only reason Au isn't "priceless" at this point.
"GLD is the only reason Au isn't "priceless" at this point."
Right. That would be the ONLY reason. Stupid GLD/Fed/Dollar/Sheeple/China/Obama, etc...
Keep spinning that Wheel of Blame.
The demand doesn't necessarily matter because the price of gold in dollars is tied to the dollar, which is rising.
The demand can be at all time highs, but if you need less dollars to buy gold because the dollar has strengthened, the price of gold will still drop.
Also, gold broke it's 1080 support today, which is extremely bearish over the short term.
LoneStar
You have hit on the only point that matters. It's funny to me how many of the commentors here seem to have no idea what you are talking about.
This paper-gold price stuff is only for trader playing. Has nothing to do with bullion supply-demand, which reality the charts are pretty much disconnected from completely.
Hope everyone's enjoying the paper games while they last...I don't think they will much longer.
The only thing that I hate about the FAZ is all that compounding going against you. (I'm long FAZ as well right this moment)
I couldn't find any FAS to short, but that is the better trade IMO than being long FAZ, cause then you have the compounding working with you instead of against you.
though faz/fas is indexed to Russell Fin 1000 (rifin.x), i do watch BKX closely....on a 60 min, it appears to me that we had a classic h & s with right shoulder forming in a choppy fashion the past few days....right shoulder dropped and blew throught he neckline this a.m.
on spx, need a break below 1071 to really move south in my view...
I am long FAZ and short FAS simultaneously just to make sure I don't miss a beat. If financials goes down in a beeline, FAZ could have several hundred percent gains or more while FAS can only go to zero.
I am holding these until late 2011 or early 2012.
I wish I was short FAS instead. That's the true killer play on a downturn in financials.
still no borrow on FAS?
There wasn't at the time that I checked, and now I'm not really looking to short it anymore because I think we're already getting close to the bottom of the day.
(Disclosure: I think in extremely short term segments. :)
hold onto that FAZ...Cuomo to announce "significant action" on a major bank per cnbc dot com breaking news...
criminal in the bac/ml/lewis matter?
something different altogether???
I have CNBC on in the background, which I'm just kind of glancing up at from time to time, but I heard them announcing something about Ken Lewis and BAC after the break.
You may just be right, sir.
c,mon people you don't always have to "junk" MB's post's. he,s starting to show some humility here.
(note to self)
If you can, just short them both for the sure gain, and hold forever.
You could turn an investment today into infinite gains by shorting both due to negative compounding and holding forever...
yeah
unless the underlying decided to trend in one direction at 10% a month for over 5 months
then you'd be wiped out completely
of course, that could never ever happen
especially since every joe 6 inch on the internet now fully "understands" how leveraged ETFs always get smaller and smaller
lol
Where is Peter Schiff? Where are all the USD bears who were going to make millions in the imminent USD crash? This is hilarious.
Don't laugh at your own peril. Schadenfruede is bad karma.
Nothing wrong with shadenfruede. Nothing wrong at all.
Some people just don't know what they are looking at.
Success is a vital step in failure and rising dollar is a vital step in it's decline. You think the bond sales are when the hyper inflationary money is created. Nope it's created in the large overseas settlements. This neediness for dollars does not lead to satisfaction. It leads to isolation.
+11
Give a junky more herion, it will calm his nerves, he will be fine ;)
They call it a cup and handle. It's in the process of forming on the USD now. We all know where cup and handles go.
Currencies are all relative, and besides the Yuan, the dollar is best of show.
Besides, who wants to hold Yuan with the pending revaluation?
This isn't finished. Be careful. If you are nimble, go for it, frolic for a short swim. But this isn't the way it is going to stay.
I think the truth of the matter is we are going to go through many phases of deleveraging, timing will be everything as you try to ride the wave into shore.
Me, I'll hold gold and cash, knowing that I am watching for when to convert the cash to gold.
Dollar won't make it because no fiat will make it. But that is a very long call guiding my personal choices.
Congrats to you if you are brave enough to be in, and you can get out in time.
See, the only problem that I have with that analysis is that I don't think that the USD is particularly strong, but I do think that it's stronger than anything else that it's compared to.
I think that just the sheer comparison to other currencies like the Euro and Yen will bring the dollar higher, even if there's overall weakness in fiats altogether.
Otherwise, you have good reasoning.
I am a chicken, I don't have the kind of money to work with many folks on here do. I think medium term the dollar will do "weller" than other fiats.
I admit the gold drop is scary. At the airport yesterday I saw Obama giving a talk. He is saying things like "They handed me a bomb and it blew up on me" and "We won't be out of this any time soon" and he was tripping over every thing he said and no enthusiasm in the places he should have had it.
Dude, he knows we are fucked. But so is the rest of the world, which takes us back to your view. Short to mid term, dollar okay. Long--->PMs.
To be honest, I probably have less money working for me than anybody on here!
I'm just a poor college student that LOVES this subject, but needs my money for next semester's tuition. I used to have a good job, but now I'm using all the money I made trading before to try to make it through the end of college, since I have little income coming in.
I think that the jig is up as far as the fake reinflation trade, and I think we'll be in deflation mode until the NEW stimulus coming on the horizon.
I think that we'll see some bearish moves coming up with the end of the MBS program and the like... but since it's an election year there WILL be more stimulus and then we'll be back in the inflation trade again for a while.
I still see more upside in PM's and in the S&P long term, but I'm not in the "gold is going to 2000" camp either. I'd say mid thousands is the highest we get if we get there.
Just trying to avoid the "circular firing squad":
http://www.marketwatch.com/story/our-debt-time-bomb-is-ready-to-go-ka-bo...
I agree, but here's my thing: the U.S. is much better off than others for a couple of reasons.
A) People all across the world need dollars for financial transactions. As the Euro is in much worse shape, the Euro won't replace the dollar anytime soon. That alone gives the dollar strength.
B) The U.S. debt situation, while bad and getting much worse, isn't as bad as other developed countries. In currency markets, where everything is relative, the dollar should be the last shoe to drop. It's not that the dollar is particularly strong, it's just what would you rather buy? The Euro? The Yen? Or some "developing" currency that has already perhaps had its run up?
That's why I wouldn't be so bearish on the dollar in the near term, because there are a lot of other people in worse shape than the U.S., with traditionally less stable economies to boot, who will default and have higher interest rate spreads long before we do.
I agree not to be bearish USD in the NEAR TERM, as you said.
But only in the very near term.
The USD is beyond fucked and everyone knows it. The fact that the (south) eurozone, the UK, and Japan are likely to meet their doom before the US does makes this 'flight to safety' about as prudent as running to the upper deck on the Titanic. I mean, hell, the YEN pounded everyone yesterday including the USD. The US dropped like a rock against Japan. And how well do you think THAT investment gonna turn out? When the yen is a long we are in interesting times indeed.
You ask, what would I rather buy?
Despite their hammering yesterday, I'd still rather buy the resource-based currencies (CAD, AUD, etc).
They have their own problems like the US with large numbers of insolvent citizens and businesses, but much of their debt is still private rather than public. AND, they have REAL STUFF to sell - natural resources - which countries will still need to buy regardless of whether they're 'in recovery' or not.
And - longer-term still - I think the northern eurozone (not the south) has a lot of potential as a viable currency. I expect Germany is going to succeed at cutting off the PIIGS deadwood perhaps even this year.
So - who would I rather buy? Pretty much anyone but the twentieth-century giants I guess. It's a brand new century now. :-)
See, when you aren't political I like your posts. I am the same. What other currency is stronger than the dollar? Although, I am watching the dollar and yen strengthen together. I haven't found a resonable explanation for that. Anyone?
Well, I'm just passionate about politics, like I'm sure most people are.
I think that the Yen is also relatively stronger than say, the Euro, because Japan is still running surpluses despite its debt problems.
Currency is all a relative market, really. It's not that the dollar's awesome, just what's better?
Same with the Yen, it's better than the previous king of the hill Euro.
It's all a function of the Euro getting smashed.
On this, we completely agree.
Fine. But how long will the dollar stay up? So far its needed a lot of VIAGRA to stay up. Sure other currencies have weaknesses. But our dollar has a lot of negative debt math compounding, growing mushrooms. It CANT turn out well for the Dollar after all the manipulation and lies.
History and math will NOT be denied by hope and dreams.
And i would love to be wrong on this.
Cant earn a dollar with no job, and theres hardly a job to be had. Thats why i think the dollar will die
But you have to look at the dollar from a relative perspective.
It doesn't have viagra to stay up, it was viagra (money printing) that was holding it down. The viagra wearing off is what is bringing it back up again.
The manipulation and lies were holding it DOWN, not up. When the manipulation stops, dollars will be fewer and worth more.
Even your own arguments (its hard to get dollars) are bullish for the dollar if you think of that.
Unless you see more printing (which will probably happen, but I just don't see a doubling of our money supply either) the dollar will continue to gain.
What about medium-long term? Are we not at risk of seeing major deflation in the Euro zone with talk of tightening monetary policy and the inevitable deflation dominoe effect?
If that happens, there goes all the gains the USD saw...
$1.6 billion low interest loan for expansion of Smyrna, Tenn. Nissan manufacturing plant for lithium ion battery and Electric Vehicle production just the latest in "strengthening together". Japan fascination for U.S. Treasury bubble machine second only to China. Japan's "lost decades" soon to become U.S. "lost century"
Try the Norwegian kronor.
It's musical chairs unless you have physical possession. Check out the last paragraph from Sprott:
http://www.sprott.com/Docs/MarketsataGlance/01_10%20Beware%20Counterfeit...
Musiqal chairs and gold and silver ARE CURRENCIES. One chair will be left, and sweetie silver will sit on Gold's lap when the time comes. Hugs and kisses to follow. Save it for the bedroom you two ;)
MsC is describing the process that I am calling "panning for gold". The Fed is the one doing it btw. Look at the DXY and Gold chart and you will see that DoeLarrs are buying less gold than the last time it was at 79! BS Bernanke has his waiters on...pan away Ben! Screw fiat currency! Right BS? haha (and my apologies to those that do not find it ironic that the guy who is supposed to be helping the Doe, is killing it) It is the oligarchs that will benefit the most from high commodity prices. Not only because they own the commodities (thank you Joseph Kennedy...bastard), but also because through their control of them they will be able to usher in their N.W.O. (New World Order is their term, not mine) Not to say they will not make volatile waves so as to buy the dips.
These are the "phases of deleveraging". Got to get the soot away from the gold!
first they have to a) wrap the carry trade, then they will be able to 2) drop the bottom out of the DoeLarr. These things take time young grasshopper. Be patient.
A liquidity demand event does not change the long-term prospects of fiat currencies of bankrupt countries.
careful, you might just find yourself in a "peter schiff was right " video on utube.
FTSE down 2.1%
From an intraday point of view, I'm waiting for Ben to get into the market/bring the helicopter...
that's been the pattern but with QE ending in 6 weeks, he may just want to get treasury yields much lower now than fighting that battle later.....it'll be interesting for sure.
DOW / SP500 downtrend on the daily chart continues.
The recent equities counter trend rally has finished and the March 2009 bear market rally is over.
The dollar, crude oil and copper charts have been giving bearish warnings for stocks for months.
DOW / SP500 downtrend commenced as forecast.
The USD rally I forecast several months ago is just getting going.
My indicators can identify trend changes before they occur.
They warned me of an impending market crash back in early *2007*
The uptrend since March 2009 has been a bear market rally contained within a much larger bear cycle that started in 2000.
http://www.zerohedge.com/forum/market-outlook-0
And all this without mark to myth coming to exposure. How many more dollars will be taken out of circulation with that
-- when "it" arrives?
Would love to see Tyler do a hybrid chart of "USD" taken out of existence as per ongoing event, ie equity tank, carry unwind, etc...
See ya all at GBP and EUR par! doh!
Doelarr back to July range. Gold is not. Hmmmm.
Keep twisting the rubicks cube. It makes sense eventually.
A friend of mine was driving under a few influences and was pulled over. When the cop approached the window he noticed a rubicks cube. He told my friend if he could do it he would let him go. Noah reset it, closed his eyes and did it in 15 steps (or however many).
For you and I Hepha, it is a ruBUCKS cube. We are doing it with our eyes closed ;)
Looks like the dollar carry trade is starting to unwind.
Goods news for Germany as it floods the US with cheap bmw's and vw's. We now just have to watch US exports tank and US GDP fall off a cliff as a result of dollar strength. Volatile currency markets look good in the short term with the wall street making lots of money as a result, but the reality is that it damages the economy, forcing companies to take out expensive hedging rather than pay extra wages. How long do you think it will be before the US starts to clamour that the reserve status of the US dollar is not something to be encouraged despite the fact that it might be the biggest support to the treasury market.
Economic analogy of the day: the inverted pendulum
http://en.wikipedia.org/wiki/Inverted_pendulum
It may be helpful to view the various world economies as a series of coupled inverted pendulums - at rest in equilibrium, they are all pointed straight up. But there are strong breezes blowing, and little springs connecting the various economies together.
So as the US economy sits like a big fat pencil balanced on point in the palm of Ben's hand, the gale force winds are blowing, and other pencils are tugging on it. The oscillations necessary to keep the pencil balanced will become increasingly strong and erratic. It may not be as useful to try to understand the implications of each oscillation - but rather what happens when the pencil finally falls over.
Gold has value during inflationary and deflationary periods because of the potential and real civil and political unrest. In India/China many wear their net worth in the form of gold jewerly because it can be taken with them because Governments have failed in the past. This can happen here. Paper is near worthless in a real crisis.
Really? The US economy is in better shape than a lot of those other ones,? hmmm,. I dunno, if you added South Africa, Japan and Israel together you might get a similar economy. Except without Paris Hilton, which kind of makes a difference (all that's very wrong, but in exactly the right kind of way that if you're going to be wrong, it should be done.. and she doesn't even look professional, *sigh*.. but anyway..). Swedish Krone, unfortunate name, liabilities on emerging Baltics, mines Gold, it's a risk, recently extended household credit -which may have worked. Fairly good mangement. Also, we're pretty near the bottom of the barrel for several Agricultural crop prices; not for sugar though, Brazil and India had quite good crops and we'll probably move to surplus next year.
Why am I giving out thoughts. Grist to the mill.
Dollar useful for transactions...and what do you think it means, exactly, when the nexus of power shifts?
Somethin about " poor college student" reminds me of the poor graduated college student. Don't get me wrong....... Took me 9 years to pay off a student loan the did me no good. The years in the school of hard knocks has done me better. College.... don't get me started.
DOW/SP500 downtrend on the daily chart continues.
The recent equities counter trend rally has finished and the March 2009 bear market rally is over.
The dollar, crude oil and copper charts have been giving bearish warnings for stocks for months.
The DOW/SP500 downtrend commenced as forecast and the USD rally I forecast several months ago is just getting going.
My indicators can identify trend changes before they occur.
They warned me of an impending market crash back in early *2007*
The uptrend since March 2009 has been a bear market rally contained within a much larger bear cycle that started in 2000.
http://www.zerohedge.com/forum/market-outlook-0
I am curious, do you hold gold? Physical?