Tuesday, December 28, 2010

12/28 12:30

I'm glad I exited my silver short last night.  The gold short is now against me 1404 vs. entry 1388 but this is small change compared with the potential silver hit.
Dollar is retracing it's 5 up, down to about 80.43.  Long from 80.05.
Crude is retracing it's 5 down, probably up to 91.55.  Short from 90.975.
Stocks are rallying after almost touching critical support.  I1 small top 12/31.


  1. After a clear 5 up in the dollar, we can expect a correction that carries the dollar down to 80.42 (38%) or 80.34 or even 80.22 (62%). While the dollar is pulling back, isn't it likely that crude and gold will rally? Wondering whether you would close those short positions and re-enter when the dollar hits the 38 percent retrace (or even wait till the 50 percent).

    The 38 percent looks like a lock as that is not only a common fib retrace level, but also the bottom of the 4th wave up, which is also a common retrace area. There's an area between the 38 percent and 50 percent that could be the 4th of the 3rd up and that is also a common retrace area. So I'd put my money on DX hitting 80.34 - 80.40 on this retrace.

  2. 80.43 is my target for dollar. Crude shows 5 down and 3 up hitting 91.525. DJI is approaching old high 11,580 and crude likes to run with stocks. I don't want to finesse these correlations too much, just enter positions and hold with loose stops. Gold short is a long-term position.

  3. Thanks, Steve. I agree about the loose stops. Trying to play it too tight and you miss out on a position.

    You said gold is a longer term position. Your I1 chart for gold has it bottoming in mid-January. Is your plan to hold the position until then? Will you go long gold and PM's in mid-January?