One more thought is that we were discussing the move down in the dollar for some time as it set up a Head and Shoulders topping pattern over many months. This was all in place long before Muchy & Ross yapped in Davos.

Once the right shoulder completed, many technicians here and other sites put a move down to a 88 target on the dollar if 92-91 support broke.

The point is this was going to happen technically, based on price action on the charts and momentum to the downside, REGARDLESS of what happens in the political theater.

However, talking head on the news are always searching for some fundamental driver, so that they can pin this reason on the donkey. They don’t understand TA or price action, or algos, or machine trading, so they look for a narrative that they can sell to folks on news reports.

This is precisely why so many news organizations jumped on the Munchy and Ross comments so that they could “explain” WHY the move down in the dollar was happening.

Again, I felt the policy shift was important, but this move down in the Dollar was already in the cards waaaaaaay before their comments were even dreamed up.

Said another way, Munchy’s comments had absolutely 0 reason for gold’s failed move up to 94, and slide down to 89 (through support at 92-91). The fact that his comments coincided with the continued slide from 90 down into the 89 range were inconsequential in the overall price action in the dollar.

correction: 0 reason for the Dollars (not gold) failed move up to 94, and slide down to 89.

Here’s a prime example of the news media reaching for answers on why the dollar slid, where they attribute a move that has been happening for months to comments made the last 2 days.

Really, why do these media geniuses think the dollar went down below 92 the first time then?

Why did the dollar’s rally fizzle at 94 then? (instead of breaking out to 110-120, or at least getting up to 97-98 at the top of it’s range). ?

Why did the dollar turn around at 94 and start diving back down to complete the right shoulder of the H&S pattern?

>>> Here’s a clue: They have none of those answers, because there really wasn’t anything fundamentally other than the temporary 2-3 day debt ceiling/government shutdown theater.

Yet now, they all “know” why the dollar is heading down. (hilarious)

________________________________________________________________________

U.S. Dollar ‘Thrown Under The Bus’, But Does That Signal A Wider Policy Shift?
Anna Golubova – Wednesday January 24, 2018

http://www.kitco.com/news/2018-01-24/U-S-Dollar-Thrown-Under-The-Bus-But-Does-That-Signal-A-Wider-Policy-Shift.html

The turn arrived on Dec 13th, 2017, as previously noted.

Not Everything……..is about MINERS…………..

NO harm no foul……… 🙂

Agreed. I appreciate the bigger news, but you started this blog with “Told Ya….”

That seemed to indicate that because many news outlets wer covering Munchy and the dollar that they have some clue what is going on. As mentioned above and yesterday, I think it is significant and newsworthy, but it has little to do with the “Bigger” reason the dollar has tanked.

In addition, I never said it was all about the miners, but let’s be fair here. The discussion yesterday when this came up was about Gold rising along with the miners. The weak dollar was just supporting this move up lately, but was NOT the only cause, the cause as the FED hike on Dec 13th at the end of tax loss selling.

That was the point. You replied that those discussions with this:

“The Fed has be jaw boning for 10 yrs…….
I am not sure that was the Bell ringing that Loud….
That was not the first rate hike, if memory serves me correctly.
The BIGGER NEWS is……Muchy, calling for a Weaker DOLLAR…..IMHO…. ”

____________________

I responded that obviously it wasn’t the first hike, (which I had to believe that you knew I was aware of), but that the pattern had happened 3 years in a row with a FED rate hike, that spiked the Metals and the miner. It cleary WAS the bell ringing.

Like you said no harm no foul, and I wouldn’t have belabored the point if you hadn’t have kept posting that it wasn’t the bell ringing or the first rate hike 3 more times and then carried it forward to this one. I guess it was the “Told Ya…” post that caused me to respond to this one, because the point I was making had NOTHING to do with Munchy or Davos or the macro political theater. It was about why the metals sector bottomed in December and has rocketed higher.

Peace be with you OOTB.

If, you would have listened to Greg’s comment, which I posted, You would have heard what He said, ……concerning the DOLLAR….which is what I….”TOLD YA”.
🙂

Peace……..cheers………… 🙂 Thanks for the follow up….

Sorry for any and all confusion……….. 🙂

OOTB – It’s all good. 🙂 Like I said we are discussing 2 totally different things.

I was discussing the Fed hikes being the “BELL” that rang again (for the 3rd year in a row in December to mark the lows in the PMs) has nothing to do with the recent political theater or Davos or what Mnunchins new dollar outlook is.

You responded that you didn’t think it was the bell ringly loudly in Dec, and that it wasn’t the first rate hike (which we all know), but instead thought Mnuchin’s statements about the dollar was the big news.

Munchin’s comments had NOTHING to do with why the metals bottomed on the Day of the FOMC rate hike —- Which was the focus of that discussion. (not the Dollar).

_________________________________________________________________

Obviously yesterday and then today, that comment didn’t make any sense and was totally unrelated.

The initial discussion was how for 3 years in a row the metals bottomed in December after the Fed rate hikes, which also coincided with the end of tax loss selling. Also there is a seasonality pattern coming out of late December an into the Q1 Run.

That is why it was so easy to project this would happen again in October, and why I said repeatedly that I would be positioning in PM miners before the Fed rate hike.

That was the point I was making, and it had nothing to do with the news of day or the US dollar

The Fed rate hike was the BELL ringing in Dec of 2017, just like it was in Dec of 2016 and Dec of 2015. That was the takeaway.

I had posted this Brien Lundin video twice so that he could make that point instead, but somehow the conversation keeps reverting to recent political theater and the dollar, instead of the point that was being made initially.

>> Brien Lundin “Gold:Following The Plan…So Far”

January 2018, Metals Investor Forum: #VIDEO

https://www.youtube.com/watch?v=Tw7Tx8CkfV

However, since the dollar weakness is so en vogue at present, and Muncy’s comments are being touted everywhere, then I’ll reiterate the point on the Dollar as well.

Greg’s point about Mnuchin are just more parroting what other news outlets are saying, and are NOT the only reason the dollar is heading down. Just because some guy with a webcam repeats what news outlets are pumping doesn’t make it so.

Confirmation bias is when we hear someone else repeat something we believe in and say, “See — Told ya so….” That doesn’t make it truth, just someone with the same opinion.

As was stated several times now: The Dollar has been heading down since it rolled over at 94 (as we projected the rally would fizzle), and most chartists here and elsewhere have been targeting the 88 level for several months.

Regardless of what Greg thinks, that didn’t have a damn thing to do with recent comments from Davos.

I agreed yesterday that Munchy’s remarks about wanting a weaker dollar may have contributed to the dollars slide temporarily, along with Ross’s comments, and China slowing down their treasury purchases, and the debt ceiling debacle, and the government shut down, and about a dozen other “news” stories, but the Dollar started heading down before any of that garbage came up.

I’ve said this about 4 times now, but I’ll say it again. The dollar was heading down to 88 whether Munchy opened his mouth or not. It was already baked in the technical cake.

Fundamentals are contributing factors, and are important, and we should all be cognizant of the fundamental factors as sometimes they ARE the reason things move. This Munchy thing though, is all a “day late and dollar short.” 🙂

For the most part, news outlets are hungry to attach a fundamental reason to a technical move they don’t understand. This happens in all markets each day (like Oil, or Gold, or Copper). If there is a technical move they don’t understand, then they grasp onto any potential news story as say “it was XXX or it was YYY that caused Oil or the Dollar or Gold to go up or down).

With regards to the US Dollar, it was going down for the count long before comments from Davos. We projected a Dollar in the high 80’s three months ago, based on technical analysis of the head and shoulders pattern.

We mentioned the that 92-91 level of support would likely fail (and it would not stay rangebound), and that it would head for 88.

That was all way before any “News” was pegged to the move at the last minute.

I called the Dollar BIG NEWS before MOST WOKE UP………

I offer those comments because there are so many days where investor are clamoring for WHY something happened?

Why is Oil going up? Why is Copper going up? Why is Gold going up? Is it due to OPEC, China metals inventories being depleted, Interest rates, Jewelry sales, coin sales, etc…..

Those are all important, and sometimes fundamentals or news stories do carry the day.

They carry the day…… not the longer term pattern of price action. That is where technical analysis comes in.

People that scoff or ignore technical analysis will often be confused on why moves are happening because they are trying to rationalize things with a fundamental driver.

This took me a long time to figure out, and I know in listening to other investors that it took them a long time to uncover as well. Sometimes the fundamentals don’t matter to price action. What matters is sentiment indicators and the price action itself, when it comes to machine trading, HFT, and technical set ups.

The Dollar fall is a result of the Head and Shoulders pattern completing and the right should failing at 92-91 support.

People can point fingers to a lot of different news events over the last few months, but that is the ultimate reason for the dollar weakness.

It will also bounce for technical reasons (not fundamental ones).

People that refuse to look at technicals will be just as surprised when and where that happens, and will just try to latch onto some other news story or fundamental when that plays out.

If the fundamentals made logical sense then the dollar would be going up after rate hikes, not down. but that is because the technical price action is controlling the money flows in the dollar, not the news of the day.

Again, fundamentals are important for short term moves, but they are far more important for individual companies than they are for medium term price action on a macro level.

However, for the LONG term picture, Fundamentals will ultimately shape the economic supply / demand picture over years/decades. They just won’t typically explain impulse legs up to new highs, or corrective moves down to new lows.

Hopefully that helps somebody out there that may read this.

GREG was just CONFIRMATION……… 🙂

OOTB – You did call the Big dollar news of the day yesterday before most woke up. 😉

My time horizon and discussion was on December to present.

That’s my point, we have been discussing 2 different topics. Parallel threads.

I also give daily news stories very little importance, since we’ve been saying the dollar would get down to 88 for 3 months before people woke up yesterday. 😮

Yes OOTB – Greg was just confirmation. That is why you felt compelled to say “Told ya…”

___________________________________________________________

What Is Confirmation Bias?

Shahram Heshmat Ph.D. – April 23, 2015

“Once we have formed a view, we embrace information that confirms that view while ignoring, or rejecting, information that casts doubt on it. Confirmation bias suggests that we don’t perceive circumstances objectively. We pick out those bits of data that make us feel good because they confirm our prejudices. Thus, we may become prisoners of our assumptions.”

“Once we have formed a view, we embrace information that confirms that view while ignoring, or rejecting, information that casts doubt on it. Confirmation bias suggests that we don’t perceive circumstances objectively. We pick out those bits of data that make us feel good because they confirm our prejudices. Thus, we may become prisoners of our assumptions.”

https://www.psychologytoday.com/basics/confidence

That didn’t post correctly but this was supposed to be included with the article above on Confirmation Bias. (rather than the double post)

“In sum, people are prone to believe what they want to believe. Seeking to confirm our beliefs comes naturally, while it feels strong and counterintuitive to look for evidence that contradicts our beliefs. This explains why opinions survive and spread. Disconfirming instances are far more powerful in establishing truth. Disconfirmation would require look for evidence to disprove it.”

“The take home lesson here is that set your hypothesis and look for instances to prove that you are wrong. This is perhaps a true definition of self-confidence: the ability to look at the world without the need to look for instances that pleases your ego.”

You want to know something……..concerning confirmation……
I referred to the GANN report, and Flanigan, (which Bobby likes, (said was one of the best in the business)
if, you will recall, …..I said YESTERDAY, that Flanigan was looking for confirmation, that the stock ,,HUI was suppose to hit 160 for a stronger bull market , which it did not hit in December…..and that the sideways motion was not confirmation of a New Bull Market
That was Yesterday early.
Today, he has confirmation , because of the DOLLAR……just saying…… 🙂

Thanks OOTB but we got our confirmation that Gold was in a new bull market when Gold double-bottomed in December of 2015 (after the first FOMC rate hike in 8 years).

When the metals and miners blasted through 3-4 layers of resistance on key Fib moving averages, and took out 3 of the prior peaks of resistance, while charging higher in past the PDAC curse and straight up into the Summer Doldrums.

That was multiple confirmations in late Dec 2015 through the first half of 2016.

Combine that with fact that Gold has not made a new low in over 2 years now, (while conversely it’s been putting in a string of higher lows and just took out 2017’s high in overnight trading) this it is clear and has been clear that Gold has been in a bull market since it bottomed in Dec of 2015.

If Flanigan is just NOW confirming a Gold market then he’s a bit late to that realization. Just sayin’ ….. 😉

I do appreciate you sharing the info though, as yes…. if Flanigan is on board then it is more “Confirmation.” Cheers!

GO back and check your records……..
I said GARY S…….called the DOUBLE BOTTOM…..back in 2015 and GOLD was on the MOVE…
and YOU WERE NOT the only One calling the Bottom………. 🙂

Trump reading the tweets………
SO goes the Dollar up………..
https://www.zerohedge.com/news/2018-01-25/dollar-surges-after-trump-says-mnuchin-was-misinterpreted-dollar-will-get-stronger

Thanks OOTB. I never said I was the only one calling the bottom back in Dec of 2015 anywhere on here or anywhere on the KER, so I’m not sure what you are insinuating honestly. We’ve been discussing the recent bottom back on Dec 13th and what caused Gold to bottom and surge – which was mostly the FOMC rate hikes and clearly they took off like crazy right after the hike at the end of last year.

That was the only point being made yesterday and today. Not the news of the day as it relates to the dollar, nor who called the 2015 bottom.

___________________________________________________________

However since you brought it up, I will say that Matthew, Gabriel and I called the double-bottom on here a few days before Gary S posted about it, because he was waiting for confirmation first. I gave him credit at the time when several people posted his call, and he was one of the few “gurus” that nailed it.

However, at the end of 2014 I mentioned a key level for the major bottom in Gold was $1044.70. Gold bottomed at $1045.40 so from over a year out I missed it by $.70 using TA. Hardly anyone called that.

There were no other Gold gurus that got anywhere close to that price target except 1 and he isn’t a gold guru. Rick Ackerman was the only other person I remember that had a target of $1044.50 that he put out about month out from the bottom, and he nailed it. Rick rarely gets any credit for that, but it was much closer to the actual event.
_________________________________________________

On this recent Dec 12th low I started discussing back in October of last year that this meet is what I expected to be the trigger and low point for Gold (like it had been after the hikes in 2015 & 2016. I was buying pm miners the Friday, Monday, and Tuesday before the FOMC on that Wednesday and posted quite openly about that on this blog. Other than Matthew and Wolfster (and maybe GH) most were not touching the mining stocks at that point, and some were quite bearish and expecting lower lows or the bear market to resume.

Paul L and I nailed the double bottom in Oil on here to the day, and Mike and I bought at the exact bottom, but then flipped our position the next day because we second guessed ourselves.

I’m not great at figuring out how long a rally will last, but one skill set I do have is getting very close on where turns will happen at the bottom.

Having said that, I never claimed to be the only one to call a bottom and just listed about 6 other people up above that called them along with me. In addition Bob M is pretty good at catching tops and bottoms. In contrast most of the main commentators on this site have been very late to the party at each bottom and most of them missed out on huge gains in the epic runs in early 2016, for Uranium in Nov 2016 – Feb 2017, the big move in PM miners in Dec 2016 – Feb 2017, and this last Falls rally from August – Sept 2017 by being on the wrong side of the fence.

Investing is tough. Investing in the commodity space is even tougher and not only cyclical but very volatile. Investing in the miners in the commodity space is one of the hardest sectors to get correct, and NOBODY gets it right all the time.

I sincerely hope you don’t believe I think or have ever claimed to always get it right — because I don’t. I make errors in judgement all the time….. but I get it right about 60-70% of the time and that is all anyone needs to do to profit in this sector.

OOTB I appreciate your wisdom, contributions each day/week/month/year, and all the other posters on here and recognize the value you bring. Hopefully it is reciprocal.

Ever Upward!

I appreciate your wisdom, contributions each day/week/month/year, and all the other posters on here and recognize the value you bring. Hopefully it is reciprocal………….
DITTO……………………..

I’m still working on picking out my party hat of choice: 😮

https://www.google.com/search?q=party+hat&source=lnms&tbm=isch&sa=X&ved=0ahUKEwjR0anJrPLYAhXDtVMKHcLJAzQQ_AUICigB&biw=1536&bih=883

Alright, since this is a Gold breakout, I’m going for this party hat tonight, along with a cool refreshing craft beer.

https://thumbs.dreamstime.com/z/party-hat-249572.jpg

AND, for the “buck to 120!” crowd:

https://media.istockphoto.com/photos/businessman-in-dunce-cap-looks-down-ashamed-and-embarrassed-picture-id175597538

haha! Those poor Dollar Bulls looking for the Buck to 1.20!

currently 88.84

There must be one hell of dollar bull unwind going on at a massive level to see falls in pricing this severe in the greenback.

The dollar to the moon was set in stone to a LOT of people – including a lot of experts. So, yes, there’s a ton of money on the wrong side.

US Dollar To the moon! (epic fail)

https://images-na.ssl-images-amazon.com/images/M/MV5BMTQ4Nzg0NjA4MV5BMl5BanBnXkFtZTcwNjI4MDYyNQ@@._V1_CR0,60,640,360_AL_UX477_CR0,0,477,268_AL_.jpg

Need to mark this post. These words will live in infamy.

I don’t know why you’d want to bring attention to your infamous words… again.

Spanky do you mean like these infamous words of yours that are already infamous?

Infamously wrong that is….

• On September 19, 2017 at 10:43 am,
spanky says:

“The question is, how low and for how long. Personally, I don’t see a bottom until spring 2018.” — spanky

[no spanky, the metals bottomed right after the FOMC meeting on Dec 13th, exactly like I mentioned to you that they would. We didn’t keep falling into this spring]
_______________________________________________

>On October 24, 2017 at 10:50 am,
spanky says:

“Gold’s move in 2016 was nothing but a countertrend move to reset sentiment, just like in yen, and it looks like it did exactly that. New bull market, blah blah blah.
Everything is going to become crystal clear over the next year. Waterfall into the 200 WMA in the miners incoming.”

[we’ve covered this at length, but if that were true, Gold would have continued down to make a new bottom in 2016 or maybe in 2017, but over 2 years later it is nowhere close to bottom. In fact it just broke above the 2017 high last night in overseas trading. How you can think Gold over $300 above the low, 2 years after it was put in is still in a bear market is mind boggling]
____________________________________________________

> On October 24, 2017 at 11:20 am,
spanky says:

“Please… AXU is headed to 1.08 and then sub 1.00.”

[just a few days later on Oct 30th AXU bottomed at 1.11 and then charged higher from then on up to $1.73 recently]

“Could it bounce off the lower monthly BB for a month or two? absolutely. Wake me when it it bust $2.00. I think I will be asleep for many, many years.” — Spanky

[as mentioned AXU bounced a few days later for Nov, Dec, and January and just hit $1.73 recently. Just a few months later it got close to the level that you said may not happen for many, many years….. You’re the best counter-indicator spanky!]

. On October 10, 2017 at 1:08 pm,
spanky says:

“Wake me when silver cracks $18 (that’s USD not pesos). I think it is going to be a very long nap, might even turn into a dirt nap for me by the time it sees $18 again.” — spanky

[Don’t worry, unless you plan on dying this year, we’ll be waking you up when Silver gets over $18.]