Sunday, January 25, 2009

US Dollar Rally is melting under Obama's charm. DXY, GLD, SLV, GDX, HUI, XAU, AUY, TNR.v, RMK.v.

Treasuries are selling off, markets are trying to rally, but the most important is the break up in gold above MA200. Technically we are positioned for a break down from recent counter rally in USD on Daily:
First Bearish Engulfing on 20th, 21st.
Second Inverted Hammer on 22nd.
Followed by Shooting Star on 23rd.
All are very Bearish Candles with Gold breaking Up on 23rd.
RSI has turned negative below previous high, Slow STO is crossing the Sell, MACD will turn Bearish with another move Down below MA50 84.26.
Last week US Dollar rally fading strength was based on "awful" news on banking crises in UK, perception of a very bad banking crises in Europe and official entering of UK into Recession with Q4 minus 1.5%.
What will happen with US Dollar with announcement of US GDP and new efforts to keep insolvent banking system in USA afloat? We will see it next week, but Gold which is fighting against all its usual enemies is signalling Inflation and lack of trust to all FIAT currencies.
Fundamentally the US Dollar strength is an Irrational Delusion about which books will be written for years.
To raise a question about Chinese intentions in the currency markets by "Treasury Secretary to be" is at least questionable tactic for us at this moment of US financial system survival mode, but pronounced with "desire for a strong US Dollar" it could be a signal for a dollar going sharply down. External enemies to be blamed as usual if necessary.
We will not be surprised here that the majority of Buyers of treasuries at recent artificially inflated prices are already structures controlled by FED.
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