Dollar Gets Gobbled Up Today

The best sports writer on baseball used to say that a season was extraordinary, every season. He delighted in how actually playing the game always surprises. Every year has its new heroes and goats. Today we had a squash and a turkey (ok, cheap puns right before Thanksgiving).

Stocks were inconclusive but sentiment is going to extraordinary heights, the sort seen at tops. Given how badly the US Peso did, we might have expected more of a move in stocks. Word of advice: don't extrapolate from these sorts of low-volume holiday-shortened weeks. Wait until next week. Then find excuses. Neely has held his short position.

Bonds continue to go up, yields getting squashed. Mortgages got to record low rates. Extraordinary! Yves may be right in his bond call of a wave 3. A break of 3.88% in the 30-yr pretty well confirms Yves. The long bond would be likely to run to 2.5%!  That would be amazing.

Dollars got cheap today. The USD did a major tumble today to new lows for this wave down, but still above the record lows of last year. We got to DX74.25. The record low is 70.70 reached on Bear Stearns Day or thereabouts in Mar08. What will we call this new bottom if we get there? Tim Terrific Day? Helicopter Ben Weak? Ah! Goldman Sachs Season!!

The STU says the consolidation pattern of the past two months can be counted as a fourth wave triangle in a long ending diagonal down. They seem constantly surprised by the Peso's weakness. I must say, Neely has been calling the Dollar/Euro better than EWI for the past three months. Neely is considering going short the Euro. But maybe the STU finally got there as well. This thrust down is typical of coming out of a triangle, and might presage the end. These sorts of thrusts typically run the long width of the triangle, which means it has more to go. Down. In the meantime, the world remains up Down Under, with the AUD above 93c and approaching parity. Amazing. Love Chinese bubbles!

Gold hit new records, although still below its inflation-adjusted high in 1980. It too is in a thrust, a parabolic one up. Hard to gauge where it ends. How can it not bust through $1200? Then again, we really have this backwards. If gold is real money, it hasn't changed. Fiat currencies have dropped. I read that an ounce of gold today buys a decent Italian suit; and in Roman times would buy a decent Toga. Both Italian made! Amazing. 

NPR reported that the cost of a turkey dinner dropped from last year. Deflation! Enjoy stuffing ourselves. It is the thing to do in a bubble (echo). 

Comments

[Mark]

Good posts Mr Yelnick. I hate to go against the guru's, but you really need to see my latest post called History Repeats Itself. It's a chart that shows we've been down this road before, and the potential upside (and downside), based on it. Keep up the good work...I am a fan.
Ceo Trader
Mark

[Roger D.]

Kissing the backside of the rising wedge good-bye looks to been a very good call by Prechter and Neely. Currently this morning the futures are down 17, Europe is down hard also.

I think Bernanke's backside will be very sore in the coming days. Ben having to drain liquidity to support the greenback? Or will the equity market decline unwind the dollar carry? What came first the cart or the horse.

The possibility of opening down -25 tomorrow morning should look fitting for the start of P3. Happy Thanksgiving to all.

[e_djur]

Merry & Happy Thanksgiving Day for The USA.

[vimsin]

You really have outdone yourself with this writeup. I can't stop laughing at your puns and twisted humour. Happy Thanksgiving.

[twitter.com/DrBubb]

Ice has been broken : Euro back below $1.500 !
(see: http://www.greenenergyinvestors.com/index.php?showtopic=8307 )

Chart : http://img28.imageshack.us/img28/8392/001fw.png

This could be a very important reversal.
Yesterday's rally in Euro, drop in the Dollar may have been a "false break", engineered by the US govt, to permit an ambush on two days that are normally quiet.

FTSE is down big: -5203.16 Change: -161.65 / Percent Change: -3.01%
A big move, indeed.
Next, look for stops to get him on Gold and other commodities.

[DG]

Yelnick,

Thanks to you for providing the blog and the great commentaries you post to attract the many astute commenters you have (along with some "turkeys", of course)!

Happy Thanksgiving!

[Michael]

Ummm... in case anyone cares, Dubai is proposing to delay debt payments, thus risking the biggest sovereign default since Argentina in 2001. S&P's are off 24 handles.

[TJ]

Yep, looks like Michael is one of the few people who actually trade for a living as opposed to those that spend all of their time posting endless drivel about "theory".

Most European markets are off anywhere from 3.2 to 3.6%
The Euro is at 1.5014 and down 0.0120 (0.8%)

[DG]

Michael and TJ,

You guys should get a room. There's a couple of posts IN THIS THREAD about the overnight action, so acting as if you two guys are the only ones monitoring the ES futures and the Dubai announcement is ludicrous.

Seriously, you guys would impress more people on the Yahoo boards, I'm sure.

[elskid]

what is a good site for overseas numbers?

[KRG]

may be you can call it the desert storm day