-- Posted Tuesday, 16 December 2008 | Digg This Article
| Source: GoldSeek.com
Rick’s Picks
Tuesday, December 16, 2008
“Phenomenally accurate forecasts
Is the dollar finally starting to crack? It surely looks that way, although we’ll need to see another day or two’s worth of action before we can be more certain. The carnage so far has crushed two key supports on the Dollar Index’s daily chart, and it won’t take much more selling to obliterate a third, greatly compounding the technical damage thus far. That would occur if the steep plunge begun on December 4 surpasses the 80.75 low labeled in the chart below. If this were to occur without an intervening correction lasting more than a day, it would make the selloff the most powerful we’ve seen since the dollar embarked on a huge short-squeeze rally in July.
We’ve written extensively about the seeming anomaly of an intrinsically worthless dollar moving relentlessly higher, as it had been doing until late October. This was not a flight to safety, as mainstream reportage had it, but a massive short-squeeze powered by borrowers of dollars who have been finding it increasingly difficult to keep rolling their loans. Although we might have expected the dollar to climax more spectacularly, putting a decisive end to the dollar’s reserve currency status, we are open to the possibility that its last gasp is taking the form of a garden variety head-and-shoulders formation (also shown in the chart).
Whatever the case, buyers of gold and silver haven’t been timid about discounting the dollar’s fall. Yesterday, Comex contracts for both metals exceeded minor Hidden Pivot rally targets, raising the odds that they will soon achieve even more-ambitious targets that come from the larger charts and which were spelled out Sunday night in the touts section of Rick’s Picks. The higher targets are well shy of new record highs, but if they are achieved it would imply that there is sufficient buying power to refresh the bullish trend for yet another run (in Gold) to $1,000.
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Information and commentary contained herein comes from sources believed to be reliable, but this cannot be guaranteed. Past performance should not be construed as an indicator of future results, so let the buyer beware. Trading in futures and options contract can be extremely risky, and it is possible to lose your shirt before you even realize what has hit you. For that reason, you should consult with your broker as to your suitability to such trading before you attempt it. Rick's Picks does not provide investment advice to individuals, nor act as an investment advisor, nor individually advocate the purchase or sale of any security or investment. From time to time, its editor may hold positions in issues referred to in this service, and he may alter or augment them at any time. Investments recommended herein should be made only after consulting with your investment advisor, and only after reviewing the prospectus or financial statements of the company. Rick's Picks reserves the right to use e-mail endorsements and/or profit claims from its subscribers for marketing purposes. All names will be kept anonymous and only subscribers’ initials will be used unless express written permission has been granted to the contrary. All Contents © 2008, Rick Ackerman. All Rights Reserved. www.rickackerman.com
-- Posted Tuesday, 16 December 2008 | Digg This Article | Source: GoldSeek.com
