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Sunday, December 6, 2009

Possible US Dollar reversal, market decline to follow

On Friday, the US dollar made a major leap in valuation. This is critical since a stronger US dollar means a stronger US, cheaper resources, lower interest rates, cheaper foreign goods. It unfortunately will likely mean a decline in the US stock markets, and has already started a panic sell on gold.

I have posted in the past about how the USD devaluation was a direct link to US stock market appreciation. IF the US dollar is going to start to appreciate, for months to come, one can expect the reverse to happen in the US equity market.

The world would love to have the US dollar appreciate. In effect their goods and services become cheaper to the US consumer, and therefore we can afford more of their stuff. Also, many countries are US creditors, and those "assets" appreciate. So before you start predicting US dollar collapse, ask yourself, what countries other than Iran, North Korea, and Syria want the US dollar to collapse?

China, ha! India? Russia? All of these countries directly benefit from the US government NOT collapsing, and their currencies getting cheaper vs USD. We witnessing currency devaluation insanity warfare. I warned of this previously as part of the mistakes made the LAST Great Depression. At the end of this volley will likely be all FIAT currencies suffering devaluation, with resources like gold and oil skyrocketing. Just not this month.

As previously started, I'll try hard to be conservative and load up on the gold miners when it is a GIFT for the next wave up. (click to read) I may start when Gary of Smart Money Tracker says to, but wont load the boat until I believe its time.

OK, to the charts! Gold, Gold Miners, US Dollar, US stock market, and beyond!
For the gold miner chart below, click to see buying gold miners on 10/30/09 and post on selling miners on 11/17/09.
From WebSufinMurfs FinancialBlog2

From WebSufinMurfs FinancialBlog2

If The stock market breaks below the lower trend line, watch out!
From WebSufinMurfs FinancialBlog2

From WebSufinMurfs FinancialBlog2

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