If you read enough BS about theories on why such and such is moving up or selling off you’ll go apeshit trying to figure it out. So what do we do then? We pay attention to price, which is all we can do to understand the truth at any point in time.
Case in point is the US Dollar. Just as we think QE2 will bomb the dollar, it rises – and strongly. In fact, we came within .02 of breaching a level where techincals would potentially be broken and cycles would possibly be reset.
So what to do? It’s funny, but gold and silver continue to hang in there, but if stocks show any major weakness soon, chances are the metals will weaken too and the dollar will strengthen further. We won’t know much until the G20 meets again this week.
Will Bennie and Timmay give the 1-finger salute to them all and flood the market with more dollars or will they be pressured to ease up on the QE plan? We don’t know yet, but the only way to plan and adjust is by watching price and avoid reading too much about why and when.
So far the same course exists and I’m staying long all things that would hurt if dropped on my foot. If dollar strength changes that course, we reassess and maybe lighten up on the gas a bit (and probably sing some AC/DC)……..