This morning the US dollar spiked to the downside and then instantly turned back up. Now we have to see if we keep getting higher lows, as that is one sign of a bullish phase cranking back up.
One thing I like to stress is that the commercial hedgers are net short by a wide margin, but I have also witnessed them make dramatic changes from one week to the next. Besides those commercials are net short in the precious metals which I think could have far more power than one single asset class. Commercial traders don’t have the same agenda as non-commercials do as they work inside or with the people closest to the industry.
Many Gold investors may wish and pray for the US dollar to implode but that is highly unlikely this time. The 2008 low in the US dollar was a.”Major” low that I documented very well. The US dollar also produced a giant falling wedge, about 23 years long. By itself, this type of wedge is extremely bullish, so it’s not just about any single wave count.
I spent years looking at the US dollar as a big bear market rally but every bearish wave count I came up with would never last for very long.
A new record high will help to confirm that the bullish scenario is alive and well!