Here we have the Dollar Index and the UUP of course is the ETF for it. Aside from any brain surgeon's arcane economic theory about the impending death of the dollar, does this look like something that is crashing?
Honestly folks I have been harping on this for so long and at least readers of this blog have been told this was going to happen. Those who have been fortunate enough to find my blog which is not advertised in any way shape or form, have not been caught by surprise here. I did state in here just about a week ago that I was looking for a large upward move here, and viola here it is. This is just another example of why you need to learn how to trade. You cannot invest your money based on these macroeconomic theories. Why do you think most economists don't trade or invest well? After all aren't they all supposed to be more intelligent than the rest of us? They have all their degrees from fancy institutions.
Here is why they are wrong all the time, they are paper champions. What that means is they are textbook smart but not real world smart. There is a huge difference between these two things. Tom Brady looked bad at the combine when he was drafted in the 6th round by the Patriots and Ryan Leaf looked good. I think we all know how that turned out. Macroeconomic theories are based on so many assumptions in a completely random world. I would go as far as saying these theories themselves are arrogant in some ways. It is arrogant to assume that things will happen exactly as you think they should in the future. The nimbleness you can maintain as a trader just by watching what is actually happening is invaluable. You do not get stuck in a view.
Chairman Barry's plan being the communist that he seems to be rolling along just as advertised. So many people think this conversion to socialism and all this spending have to lead to huge inflation. If you study other countries and when they have converted to socialism what you will find is kind of flat markets. Everything is controlled so to me it makes sense. All these geniuses will come out and tell us why things should crash because of that but from my research I have not found that to be the case. Again, real world occurences vs textbook theory. If they can manage to steal enough from people like me without having any further fallout, they may be able to keep things relatively flat for quite awhile.
The good news is that the deoupling of the dollar and stock market inverse relationship is happening, and that is good for trading.
In any event, if you push back from the table a bit and just keep things a little simpler, we have a nice uptrend going here now so in general buy the dips in the dollar and short rallies in commodities.