As we all know the market has been stuck in a difficult trading range for the last three weeks. Perusing the blogosphere I'm seeing countless methods being employed to try and forecast the direction of the market. Needless to say none of them are working at this point.
In my opinion the only thing we need to watch is the dollar. The Fed is going to try to debase the dollar and inspire another phony rally based on nothing more than inflation. However the forces of deflation are pressing down relentlessly.
We have the potential for a T1 pattern (you can find the technical rules on the lower right side of the home page) developing in the dollar. If the buck breaks out of this consolidation to the upside then we will most likely see the market move to new lows.
If the dollar explodes higher out of this consolidation then we could see another climax selling event.
Until the dollar decides where it is going I'm not going to try to second guess this market.
Gold Miners - What next?
5 months ago