As the American dollar continues to devalue, I remain long gold , commodities , and all of the other things that should should be invested in during one of the first--and possibly worst--stagflationary economic transitions in history here in the United States.
Well done to all that took this trade with me! πΈ
Typically base metals are invested in during times of expansion or rapid growth where metals are in demand. Now you may get a value rise from debasement of the dollar but this is no time to long copper given the shrinking world GDP and massive pullback in the economies. Not an entry point for me.
nareshfrm
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hello , do you still advise to go fresh longs here ?
Looks like Copper is consolidating in a 4th wave of 3 up, probably a triangle, could go lower down to 2.84 but who knows. The dollar index from today's action is either another 4th wave or we've seen the bottom of wave 3 down and will rebound over the next few weeks/months (but too early to state with confidence) before wave 5 down of C takes the index lower. Wave 3 has already traveled 1.618 times (93.12) wave 1 and a little further (92.55) underneath but close enough. Long term, the dollar appears to be in an correction that likely will not take out the Wave A low around the 88 level. When the index bottoms, and after proof of a 5 wave structure, the eventuality is that the index will make all-time highs. Certainly the bearish sentiment is extreme and fundamentals widely held of printing dollars to save the economy will be ingrained into mass psychology that will make unfathomable to most investors that such a thing could ever happen until the point of recognition in a 3rd wave. By the way, there isn't much focus for now but Germany has agreed to bail out member nations in the EU by sharing debt that will ultimately be paid for by their tax payers, this could be cataclysmic compounded by the WireCard fiasco in a down turning German and EU economy. Eventually this too will rise it's ugly head as a fundamental that dollar bears are dismissive of.
SamSzulc
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@SamSzulc, This is an opinion not financial advice.
kaxo1
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Idk man, with industrial production collapsing and extreme deflationary pressures on the dollar I just can't see copper rising much higher in price unless this over-speculated market means its futures contracts are just being used as a financial instrument. Your signal looks good though, so who knows, strange times all around right now
TayFx
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@kaxo1, Deflation? Can you provide some rationale and maybe sources that we're being deflated?
kaxo1
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@TayFx, 10s of millions of people losing their jobs after reopening with PPP and unemployment benefits just now ending today. A collapsing labor force is the most fundamental deflationary pressure there is. In terms of the dollar, there's 10s to 100s of trillions of dollar denominated loans around the world since global trade is done in USD. There's already been a global dollar shortage, which has been the underlying cause and result of the GFC and every global recession since then (including this latest global financial meltdown), and has been greatly exacerbated by QE, opposite of what the Fed and CBs think, or at least want you to think. Check out research by both Jeff Snider and Brent Johnson. Back to my original point, though, with so much debt needing paid by USD after these forbearance periods are up, it's genuinely frightening to see such little amount of foreign imports here in the US, because that's a main way dollars make it to these overseas companies, especially when the offshore lenders could raise collateral rates again and trigger another asset firesale