Consider this. Everyone is bearish about the US dollar. Doesn't that give you an inkling that the US dollar has bottomed? Surely you would have to agree Mr. Stolwyk? The US dollar has not been able to break 81. That 81 level is going to be defended to the death. There's a good chance Japan and/or Europe will defend the US dollar and prevent their currencies from further appreciating and so wrecking their exports. We know nothing goes down in a straight line. So even should the US dollar be in a bear market, a 50% retracement of all its falls from 120 could be on the cards. What would a US dollar index of 100 do to gold stocks? Why has gold performed so badly despite a 30% weakening of the US dollar? Why have gold shares been performing so poorly recently? Could it be because deflation is around the corner? Gold could drop to US$300 and buy more than it does now. But in a deflationary scenario that won't do anything for your gold shares. They will also drop in price. Gold: Warning! Warning! Warning! PS. This friendly BlackWolf doesn't mind posting views contrary to the Hot Copper feel good crowd.
