U.S. Dollar Index Breaches Significant Weekly Supports

U.S. Dollar Index Breaches Significant Weekly Supports

Ref - http://cryptogon.com/?p=619

EXCERPTS:

I’m not trying to make traders out of you guys, or frighten anyone, but there is a good chance that we are about to lose cabin pressure on the U.S. Dollar.

Note the trendline (see graph in link above) following the lower highs downward? As that line approaches the support line underneath, think of the situation as building pressure. (Read more about descending triangles.)

I have seen several of these setups breach supports and then bounce, but I have more often seen this result in a strong and sustained move down.

I said previously that I wasn’t going to put exact numbers on this because of all the shakeouts that occur at times like this: but what the Hell, why not? If support/manipulation to the upside is going to occur, look for it as soon as Monday. If a situation like this isn’t followed up by strong buying, and soon, traders will interpret it as bearish and they will lean on it hard.

If it bounces, there will be no way to know if it is real. Only a lunatic, or someone who knows the future, would chase a rally on this thing long. If it rallies, it’s probably a fake out move to squeeze shorts out before the bottom falls out. I’d short any pop up to about 83, stop limit 83.17.

But, if there is downside follow through, the next two key support levels to watch for are 81.43 and the last chance holdout, 80.85, where several countries might try to circle the wagons. 80.85: That’s the (weekly) low, set back in December of 2004. Beijing and Tokyo (or someone, read on) MUST pour the support on here, or the sharks will smell blood in the water.

The perfect storm has been gathering strength for years; out of sight and out of mind for most people. We might be seeing the combined effects of real estate, oil and the intertwined federal deficit/national debt crisis.

If Beijing and Tokyo do not intervene here, the veil between worlds could become thin… Again.

In 2004, private banking clients in the Caribbean and London suddenly began buying billions of dollars worth of U.S. debt when the Asians threw in the towel and the bids dried up at the Fed’s bond auctions. Look at the U.S. Dollar Index for that period. Yes, that’s right. That 80.85 support level I mentioned above was established in 2004, after months of sustained selling. It’s nice to get a little help from your anonymous, private banking friends with billions of dollars to spend on U.S. funny money debt paper.

Well, here we are again. Is it going to be black ops banking and private accounts in the Caribbean that prop this pig up for another few weeks or months?

I certainly don’t know.

This is just a warning with a bit of context. Whatever happens, don’t get caught by surprise. Use this time to review your contingency plans and maintain a heightened state of vigilance over the next week or so.
_________________
Regards,

Ken Illingsworth

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U.S. Dollar Index Breaches Significant Weekly Supports
Ken Joined: 11 Jul 2006 Posts: 24	Dated: Mon Apr 16, 2007 1:17 pm Subject: U.S. Dollar Index Breaches Significant Weekly Supports
Ken Joined: 11 Jul 2006 Posts: 24	U.S. Dollar Index Breaches Significant Weekly Supports Ref - http://cryptogon.com/?p=619 EXCERPTS: I’m not trying to make traders out of you guys, or frighten anyone, but there is a good chance that we are about to lose cabin pressure on the U.S. Dollar. Note the trendline (see graph in link above) following the lower highs downward? As that line approaches the support line underneath, think of the situation as building pressure. (Read more about descending triangles.) I have seen several of these setups breach supports and then bounce, but I have more often seen this result in a strong and sustained move down. I said previously that I wasn’t going to put exact numbers on this because of all the shakeouts that occur at times like this: but what the Hell, why not? If support/manipulation to the upside is going to occur, look for it as soon as Monday. If a situation like this isn’t followed up by strong buying, and soon, traders will interpret it as bearish and they will lean on it hard. If it bounces, there will be no way to know if it is real. Only a lunatic, or someone who knows the future, would chase a rally on this thing long. If it rallies, it’s probably a fake out move to squeeze shorts out before the bottom falls out. I’d short any pop up to about 83, stop limit 83.17. But, if there is downside follow through, the next two key support levels to watch for are 81.43 and the last chance holdout, 80.85, where several countries might try to circle the wagons. 80.85: That’s the (weekly) low, set back in December of 2004. Beijing and Tokyo (or someone, read on) MUST pour the support on here, or the sharks will smell blood in the water. The perfect storm has been gathering strength for years; out of sight and out of mind for most people. We might be seeing the combined effects of real estate, oil and the intertwined federal deficit/national debt crisis. If Beijing and Tokyo do not intervene here, the veil between worlds could become thin… Again. In 2004, private banking clients in the Caribbean and London suddenly began buying billions of dollars worth of U.S. debt when the Asians threw in the towel and the bids dried up at the Fed’s bond auctions. Look at the U.S. Dollar Index for that period. Yes, that’s right. That 80.85 support level I mentioned above was established in 2004, after months of sustained selling. It’s nice to get a little help from your anonymous, private banking friends with billions of dollars to spend on U.S. funny money debt paper. Well, here we are again. Is it going to be black ops banking and private accounts in the Caribbean that prop this pig up for another few weeks or months? I certainly don’t know. This is just a warning with a bit of context. Whatever happens, don’t get caught by surprise. Use this time to review your contingency plans and maintain a heightened state of vigilance over the next week or so. _________________ Regards, Ken Illingsworth
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