Kischa,The chart is simply the AORDS divided by the $usd which...

Kischa,

The chart is simply the AORDS divided by the $usd which is the worlds reserve currency. Currently there is a battle between inflation and deflation (assets vs cash if you like) ie can world central banks keep asset prices rising = inflation or will they continue to fall and cash be king = deflation. I have charted the dow/usd and aord/usd and noticed long term bull market trendlines in both, my contention is that if these trendlines break down we will at least have a major deflation scare if not a true deflationary event. I think currently the main sentiment in the markets is that the fed rate cuts along with a booming asia will be able to save the US from spiralling into deflation, imo if the uptrends in the Aords/usd, dow/usd charts break down it will signal a change in sentiment towards a deflationary bias (cash is now king). The above reasoning is why I take the gold price so seriously, in my opinion an unexpected fall in the gold price against seemingly bullish fundamentals would be a signal that overall sentiment has changed from a inflationary bias to a deflationary bias. It is probably to early to call but the failure of the gold price to explode upward on 1.25% of us rate cuts may be an early warning sign that a deflation scare is imminent.