I just wanted to get these two charts out to show we've reached an inflection and possible bounce point. Despite blowing through major moving averages across all time-frames you can see on the first chart we are still within an uptrend (until that line is broken). Take a look at the RSI on the second chart and how it's plunged worse than the last crash. If the market rallies from this point the 1165 area looks magnetic and it will bring out the Head&Shoulders crowd because that would resolve at 980! However 1136 is a big-time pivot. On the other side of the coin you'll have Lazlo Berini and Barton Bigs backing up the truck. Imho, we could see this choppy market persist through June but the question is when do the Dems solve the next crisis to give them a feather in their cap heading towards mid-terms?

[Update] Here is a quick and dirty monthly view.


I will try to follow-up with more detail on intermediate targets and scenarios as time permits.

Good Luck.

-20% in 23 days equals a 300% return on your outlay of $3500 per contract.

Too bad I posted this in another forum. Is this the poor-man's platinum? If you want to guard against fiat melt-down, do it with Gold/Silver and NOT Red Gold (Copper), Black Gold (Oil), Rhodium and Palladium. Yeah yeah, you can use it to barter and trade for your grains when the world nears it's end...There is always a farmer looking to fashion a catalytic converter and is willing to trade you for your "Palladium". Otherwise let me know how many calories are in an ounce of pa-lol-dium.

Granted all of the base metals and precious metals have had huge gains over the last year, but when the proverbial shit hits the fan, there is only one AU 79. For those who are invested in these the past year, congrats. For those momentum chasers looking into the next Platinum or the next Gold, sorry. Those who just recently shunned anything fiat and went "all-in" across base metals / commodities / not-so-precious-metals still have your sense of "security" but are currently under-performing as commodities and all-things not gold have tanked. If we return to "recovery mode" these things will be repatriated. Otherwise, stick to gold...You dig?

Forgot to put Copper on that chart. It's -18% over the same period.

On a related note, the dollar is roughly where it was in April 2009, Gold was 900 then. In USD terms Gold recently traded at a 40% premium. Of course the market is a zillion% higher now. This correlation is meaningless and often goes to extremes depending on where we are in the cycle. I'm not implying Gold is 40% overvalued.

In the next post I will look at the USD, Gold and the S&P to examine a few technical scenarios.

You might have "heard" zEuro has come under considerable pressure lately when the region was hit over the head with a shovel.

From a technical perspective zEuro is at or near important moving averages off the MONTHLY chart. I also note the current RSI is touching the trendline and will be watching for how this closes on the month. This is a momentum indicator and often times prior to a correction we see positive divergences between momentum and price, so do not assume a rising momentum indicator equals a rise in price.

Nearby areas to watch for on zEuro would be 1.22750 and 1.21250, with 1.19 lingering. If that fails then there are inflections at 1.14, 1.10 and 1.07 to name a few but I'd like to see how things unfold in the near-term.


On the weekly chart we see a similar situation with respect to RSI where it is sitting on the bottom trend line. Again, if we are to see a reversal I'd expect to see it come with a higher low in the RSI, anything else will likely just be a corrective phase with new lows down the road.


The daily RSI is a little more interesting in that it leads me to believe we could see lower momentum on zEuro before it could catch some relief. If it manages to hold the current lows some inflection points are 1.25, 1.275 and 1.30. Both 1.30 will be pretty stiff resistance with an outside chance of 1.33


Also keep in mind the record short-interest in the Euro, while fundamentally correct, might be a tad crowded down at these levels in such a short time.