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Further comments on the US dollar and wage growth

Cory
September 13, 2017

With the dollar moving up today Doc and I take another look at the weekly chart to assess if this is the start of a dollar run. Overall however we are still skeptical that the dollar can make it back to 100+ on the dollar index. We also look at other markets that are impacted by a dollar bounce.

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Discussion
40 Comments
    CFS
    Sep 13, 2017 13:17 PM

    Doc, or Excelsior do you have any suggestions for Indium miners?

    My previous holdings, South American and Argentex appear to have gone belly up.

      Sep 13, 2017 13:21 PM

      Hey CFS – my only potential Indium miner (Adex Mining) went down long ago…. Most of the handful of old Indium stocks went down for the count years ago.

      The only one I’m even aware of any more is Crusader resources, but they’re just hovering on life support.

      http://www.crusaderresources.com/minerals/indium/

        Sep 13, 2017 13:26 PM

        There are a few Zinc companies that occasionally will produce a little Indium but I don’t think its a material worth pursuing for it’s own sake in most cases.

        CFS
        Sep 13, 2017 13:50 PM

        Thanks. The vital component that permits touchscreen technology is the transparent conductor Indium tin oxide. While it is not used in large quantities, and I believe China has a strategic stockpile equivalent to ten years supply, if we get into trade wars with China and it holds back supply like it did with rare earths, the West has a problem.

          Sep 13, 2017 13:13 PM

          It’s an interesting strategic material. That’s interesting about the touchscreen tech using Indium/Tin oxide.

          If you want Tin exposure I’d throw out Metals X for further inspection:

          https://www.metalsx.com.au/tin/

            CFS
            Sep 14, 2017 14:42 AM

            It’s the indium that is vital.

    Sep 13, 2017 13:55 PM
      Sep 13, 2017 13:58 PM

      , 2017 at 7:31 pm,
      Markedtofuture says:
      Jerry, here is a podcast on Voice-To-Skull Technology & Gang Stalking being done in Big Al’s neck of the woods. Around the 25 min mark, this security specialist whistleblower, claims the entire city of Seattle, Washington is being used as a social experiment.
      55 min mark, he calls out the social workers that are involved in the program to speak out.
      Electronic Harassment & Organized Stalking Insider Bryan Kofron
      Bryan Kofron is an insider to the electronic harassment & organized stalking programs.
      http://www.declassifieddocuments.com/2017/08/security-industry-specialist-bryan-kofron-aka-justin-carter.html
      DYODD…
      Patent For Microwave Voice-To-Skull Technology
      United States Patent 4,877,027 Brunkan October 31, 1989
      Hearing System
      Abstract
      Sound is induced in the head of a person by radiating the head with microwaves in the range of 100 megahertz to 10,000 megahertz that are modulated with a particular waveform. The waveform consists of frequency modulated bursts. Each burst is made up of ten to twenty uniformly spaced pulses grouped tightly together. The burst width is between 500 nanoseconds and 100 microseconds. The pulse width is in the range of 10 nanoseconds to 1 microsecond. The bursts are frequency modulated by the audio input to create the sensation of hearing in the person whose head is irradiated.
      Inventors: Brunkan; Wayne B. (P.O. Box 2411, Goleta, CA 93118) Appl. No.: 202679 Filed: June 6, 1988

        Sep 13, 2017 13:00 PM

        BTW…………where is BIG OWL

          Sep 13, 2017 13:03 PM

          He mostly just does the KER politics segments now.

    Sep 13, 2017 13:56 PM

    On Rick’s target of 120 for the USD, we’re talking apples vs oranges here with he and Doc. Rick gave no timeline and Doc seems to be talking about the next month or so. What am I missing?

      Sep 13, 2017 13:39 PM

      Toss it in with his call for $880 gold……..

    Sep 13, 2017 13:10 PM

    Doc, Gold keeps falling but NSRPF keeps going up. What price are you hoping to pay for it?

    Sep 13, 2017 13:21 PM

    Trader Vic says the dollar may fall to .60 and Rick says it will rise to 1.20.
    I predict it will go somewhere in between…

      Sep 13, 2017 13:29 PM

      .60 makes more sense than 1.20

        Sep 13, 2017 13:39 PM

        +1

          Sep 13, 2017 13:24 PM

          I think it would settle in the 80’s for the longer term and not below 78 or 80.

            Sep 13, 2017 13:26 PM

            That makes sense to me as well Paul L.

            Sep 13, 2017 13:40 PM

            The P&F chart using a three box reversal gives a price objective of 79 after a double bottom breakdown in July but, using a 5 box reversal, the P.O. is 64.33 following a bull trap at the end of June.

            I think if we polled bearish professionals, very few would have a new all-time low as their target — and that is exactly what we should expect if it is going to go there.

            Just like most bull markets, bear markets routinely overshoot the expectations of almost all observers. Remember all the people calling the Dow a bubble at 13,000 four years ago while even most bulls didn’t expect anything close to what has happened since?

            When I look at that monthly chart, I see the perfect setup for a new all-time low.

            That violent counter-trend move and breakout did an awful lot to get a lot of people confidently long/bullish despite the fact that the dollar had become more overbought than at any other time in the last 30 years. Such extremely lopsided bullishness is just what the bears needed.

            In addition, the action following the 2015 breakout has been bearish. The down-trending resistance-turned-support was tested several times until the monthly RSI(14) was “reset” to about 50 but the following move to a new high came with significant bearish divergences (which I pointed out at the top).

            I’m not going to lay out the fundamental case for a move into the 60s but it is a good one.

            Sep 13, 2017 13:00 PM

            Matthew – you bring up an excellent point here:

            “Just like most bull markets, bear markets routinely overshoot the expectations of almost all observers.” — Matthew

            I’ll keep and open mind then that if the dollar really starts to drop that it could turn into a waterfall decline from the recent highs down to new lower lows.

            Very interesting to consider what would have happen if the greenback took a nose-dive.

            Sep 13, 2017 13:13 PM

            It wouldn’t surprise me if it takes until 2023-24 to bottom — unless the central planners have other ideas.

            GH
            Sep 13, 2017 13:19 PM

            I’d be surprised if the dollar doesn’t go lower than it did in 2008/9 at ~71, a few years out. But yes, assuming a ~15 year cycle, the last two took about 7 years to reach their low; this time that would put the low, like Matthew says, around 2023/4. Which seems like a reasonable time frame for the bull market in precious metals and commodities to unfold as well.

            http://stockcharts.com/h-sc/ui?s=$USD&p=D&st=1980-01-01&en=2017-09-13&&id=p22610673719&a=544372318&listNum=17

            If one just took a line from the 1992 low, through the 2008 low, that would project to roughly a 64 low in 2023/4, corresponding to the five box reversal P&F target.

            I’ve never understood Rick’s deflation view. I assume the deflation he is looking for is actually already well underway, but in real money (gold), not greenbacks.

            Sep 13, 2017 13:56 PM

            That’s right, the deflation has been obvious if you price things in real money. Yet, not one deflationist in a million can figure it out.

            The CRB dropped 85% versus gold since 2001 (gold went up 5-fold+ versus the CRB)…

            http://stockcharts.com/h-sc/ui?s=%24CRB%3A%24GOLD&p=M&yr=20&mn=11&dy=0&id=p25797645293&a=370277015

            Sep 13, 2017 13:58 PM

            Priced in the USDX, gold has already exceeded last year’s high. A rest here is not a bad thing.

            http://stockcharts.com/h-sc/ui?s=%24GOLD%3A%24USD&p=W&yr=5&mn=3&dy=0&id=p04178453345&a=544441171

            Sep 13, 2017 13:02 PM

            The CRB looks good compared to gold on the daily chart as well…

            http://stockcharts.com/h-sc/ui?s=%24CRB%3A%24GOLD&p=D&yr=1&mn=5&dy=22&id=p21601086911&a=523710623

            GH
            Sep 14, 2017 14:46 AM

            Very interesting chart of $GOLD:$USDX !

      Sep 13, 2017 13:46 PM

      China Prepares Sale of $2 Billion in U.S.-Dollar Bonds

      By Manju Dalal and Carolyn Cui Published September 13, 2017

      “China is laying the groundwork for its first sale of U.S.-dollar sovereign bonds in more than a decade, a move toward expanding its ties with global investors as its economy improves.”

      “The government is preparing to sell $2 billion in bonds this month, and investment banks are pitching for a role in the deal, according to bankers in Hong Kong.”

      http://www.foxbusiness.com/features/2017/09/13/china-prepares-sale-2-billion-in-u-s-dollar-bonds.html

    Sep 13, 2017 13:27 PM

    Cobalt, the technology enabling metal

    http://www.dartoncommodities.co.uk/cobalt/

    Sep 13, 2017 13:27 PM

    A bounce to 95 to 97 is very possible now.

      GH
      Sep 13, 2017 13:27 PM

      I’m thinking ~95, as I don’t expect it to exceed the 200 day exponential moving average in the chart I posted above.

    Sep 13, 2017 13:56 PM

    The Nickel Market: Investing Ahead of the Crowd – Part 1
    by @Leni Brian Leni P.Eng Founder – Junior Stock Review – September 11, 2017

    https://ceo.ca/@leni/the-nickel-market-investing-ahead-of-the-crowd-part-1

    Sep 13, 2017 13:39 PM

    Boxed in: Life inside the ‘coffin cubicles’ of Hong Kong – in pictures

    Photographer Benny Lam has documented the suffocating living conditions in Hong Kong’s subdivided flats, recording the lives of these hidden communities

    Benny Lam – Wednesday 7 June 2017

    https://www.theguardian.com/cities/gallery/2017/jun/07/boxed-life-inside-hong-kong-coffin-cubicles-cage-homes-in-pictures

    Sep 14, 2017 14:06 AM