July 27, 2009 – Since March 23, 2001, we have been holding goldgrams as our Core Currency Position.
On May 4th traders sold the US dollar by shorting the Dollar Index at 83.97. Stop out this trade if the Dollar Index closes above 81.10. It appears that the Dollar Index is beginning to accelerate to the downside. A collapse in the dollar may prove to be the spark that ignites the rocket I mention in my discussion about gold.
The Dollar Index closed Friday at 78.75, not far above its low of 78.40 made in June. Watch this low. If the Dollar Index makes a new low, I expect the decline of the dollar to accelerate rapidly.