Good Morning,
It’s a chilly one here in Tampa Bay; I actually had to turn the heat on last night! Not a bad thing; in fact, I enjoy it… as long as socks don’t become a necessity. So far, so good!
Onto the COT (click here). Man, watching USD this past week was brutal. It got no love. And, it’s treading water, hoping…just hoping… someone will toss it a lifeline. Is one coming? I can’t say at this point that there’s a lifeline on the way. But, maybe, just maybe, a pair of those goofy, florescent arm floaties are sitting by the side of the pool and some kind-hearted lifeguard will kick them into the water. Let’s hope.
That said, with all the bad news surrounding USD, it might be prudent to think “contrarian”. I mean, everyone and their great aunt Nellie is kicking sand in the dollar’s face. And, hey, you can’t blame ’em. But, when this happens, we’re usually (i.e., “historically”) getting near a top (or bottom).
Why? Because the GENERAL PUBLIC is always LATE TO THE PARTY or just flat-out WRONG. The mainstream media is the same–after all, one feeds the other. It’s a sick, co-dependent relationship.
Somethings to consider:
AUD hit parity with the dollar, but the specs are going short and commercials long. Swissy, USD Index, gold and silver too. What gives? I mean, wouldn’t you think just the opposite would be happening? Could COT be telling us something? I think it might be.
GBP and NZD are at extremes, with the commercials net short and specs net long. So, I’m looking for a potential top. Of course, these things can take awhile and time is not on the side of USD. I mean, even if those floaties make it into the pool, they’re only going to work if there’s air in them.
A quick note on EURUSD. It broke out of a pennant formation (Daily) and is on it’s way to a .786 Fibonacci retracement from last year’s high. And, the pennant projection aligns perfectly with this price level and a monthly pivot; so, I like the target.
Oh, about Friday’s Non-Farm payrolls number…
How is it the US added 151,000 jobs last month (way beyond expectations) but the unemployment rate didn’t budge? Is it me, or does anyone else thing something isn’t adding-up?
Okay, it’s time for a cup of coffee to take this icy edge off. Make the rest of your weekend GREAT.
Be well and live large,