Again as I have posted before the dollar is in a long term bullish trend. The FED has been desperate to create dollar weakness so much in fact that they ask central banks to flood the market with them. There are global forces working against this. You have to ask yourself why would the FED or some “cartel” suppress prices to instill dollar confidence when in fact they have been desperate to accomplish the opposite.
For the last 4 out of the 5 weeks currency traders in London have been shorting both EUR/USD and GBP/USD crosses causing dollar strength, commodity weakness including metals. When London closed New York traders drove the crosses back up creating short term dollar weakness with London the very next day hammering again. Before the hammering started the HFT algos were constantly driving gold up not down to the 1362 reversal level, waiting for dollar strength to return and then adding their shorts riding price weakness back down. When London started hammering the currency crosses price moved down from this reversal level to another reversal level at 1240. The algos then were driving price consistently to around the 1300 level and again adding shorts when London started hammering the crosses again. Last weak London started shorting again the EUR/USD cross again but drove up the GBP/USD which effected price movement in both GBP/EUR and EUR/USD crosses causing dollar strength and they also drove up the USD/JPY causing even more strength. Last Monday I posted if London keeps this up price would move down from 1300 to 1240 again. Price not only hit this level but actually went thru it because of all this dollar strength with the dollar index going over 100. Again this involves 4 out of the 5 world’s reserve currencies and the amount traded daily is staggering and in the trillions.
Now for price to rise we would need to see it break the 1240 level at Novembers close and this would then indicate price could move back to the 1300 level and if broken would have a chance at the 1362 level. Again price movement in currencies and gold were all forecast months ago by Martin Armstrong’s computer models at Armstrong Economics. They predicted if the price did not break the 1362 reversal level at July’s close prices would weaken and price didn’t and we saw price weakness materialize. Price didn’t break the level at August close, September, nor the quarterly nor Octobers all indicating price weakness and that is simply what we are seeing. If those that bought physical had actually paid attention to the computer models and currency price movement they could have been shorting on the Comex and LBME and riding price weakness back down making profits instead of blaming the downward price on some “cartel”.
The FED could care less what the price is as this doesn’t remotely cause dollar strength or weakness as this is caused by huge international capital flows as I pointed out above. Again this is simply how price movement in one market, currencies, effects price movement in other markets like the CME, Comex, NYMEX and LBME.