- USDollar Breakdown Begins
by Jim Willie, http://www.goldenjackass.com/, via http://www.goldseek.com/
A major breakdown is in progress for the USDollar index. It has broken its intermediate uptrend which began in April 2018. Eighteen months of official rate hikes and tremendous hidden activity with derivative bond purchases, which obscure the absent USTreasury Bond buyers, have finally weighed on the King Dollar. The USEconomy suffers from 20 key breakdown signals, about which the lapdog press refuses to report. The historical tightening has turned into a failed experiment, an attempt to return to normalcy when no such event can possibly occur. Ponzi Schemes cannot be gradually unwound. The USGovt debt has gone past $22 trillion. The USGovt deficit this year is set to surpass $1.3 trillion. The missing money volume for the USGovt, a fat pig exploited by various departments, is conservatively estimated at $21 trillion. The global bond market investors no longer expect the USGovt debt to be repaid, as a failure mindset has crept into the bond arena. Given the repeated treatment since 2008, with expansion, the USTreasury Bond has become the global subprime bond. Next comes the reversal of monetary policy, where the US Federal Reserve begins to do emergency rate cuts in sequence. Expect some big name corporations to be monetized. The USDollar will be harmed, Gold will surely rise, and Oil will likely fall. A very valid point must be made. In past financial crises, the United States drew $trillions in capital from foreign markets. Next the opposite will occur, as foreigners will remove $trillions from their US holdings in both stocks and bonds. The US will be left to defend itself with corrupt devices. Gold will respond.
The uptrend is clear from April 2018 through May 2019. It has been broken, but so far without much power. It is in the early stage of breaking the intermediate trend. Watch for the Moving Average bearish crossover to occur. The 20week MA is at 96.66 and the 50week MA is at 95.99 with not much time before a potential crossover. When the 20wMA goes below the 50wMA, a long parade of alarm bells will go off. Technical traders follow the Moving Average bear signal. Also watch the 95.5 level as key support, and the 93.7 level as key support. The latter is far more important. The global revolt against the USGovt debt will play out in both the USDollar and USTreasury Bond. However, expect some profound Wall Street shenanigans and treachery, where they push the US Stock market down, cause a mild panic, and direct the funds into the supposed safe haven of USTBonds. They did the same a year ago, and 20 other times in the last two decades. They protect the USGovt debt market, and work to keep the borrowing costs down. So the irony will be seen in a bond market rally in the face of the Dollar Balance of Payment crisis.