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Wednesday
Oct212009

US Dollar sliding down the wall of worry

USD Chart 22 Oct 09.JPG


As we can see from the above chart the dollar continues to suffer and is struggling to retain its self respect let alone its value. Today the US Dollar dipped momentarily below the '75' level. We now need to watch the '72' mark as it must hold in order to stop the dollar going into free fall.

Silver and gold both benefited slightly from the dollars slippage today moving higher but not with any real gusto. The precious metals have come a long way in a short time and are currently displaying signs of that of a breathless runner in the marathon. However, we see this condition as being of a temporary nature prior to a much bigger move to higher ground.

The precious metals producers started well but also faded somewhat as the trading in New York came to a close, turning a profitable day into a flat one.

If you have not already spotted it, there is a feature on Kitco which shows the make-up of a move in gold prices between the buying of gold and the effect of the dollar depreciation or appreciation. There are times when, for instance, gold is going up but it is actually being sold and it is only the depreciation of the dollar that has given it a boost.

Have sparkling day.



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Reader Comments (1)

"We now need to watch the ‘72′ mark as it must hold in order to stop the dollar going into free fall."

Could you explain why the dollar will go into a free fall if it drops below 72? Why couldn't it just continue to drop slowly? Thanks.

October 22, 2009 | Unregistered CommenterDiana

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