Re: new chart RECAP: $1400 breakout in 2 hours = $500 of real profit...

Article of interest.........

>From Richard Russell's 12/01/2003 letter. 

So far, the stock market has paid almost no attention to the sliding
dollar, and I take this to mean that the stock market sees no problem
with a SLOWLY declining dollar. A "lightly and politely" declining
dollar makes US exports more competitive, and hopefully (and I
emphasize the word "hopefully") a slowly declining dollar will not
frighten our foreign holders of over $1 trillion in Treasury and
agency bonds.

If our foreign creditors become "tired" of seeing their US holdings
slowly sinking, sinking, sinking, they're going to do just what you or
I would do. They're going to either slow their buying of US Treasury
securities -- or God forbid, they're going to actually start selling
our US Treasury debt. If that happens interest rates will rise and the
wheels of the US economy will start feeling the brakes tighten.

And the wise-guy snaps, "So what, so the US economy slows down, big
deal." And yes, a slow-down would be OK in "normal times," but these
aren't normal times. This is a US that is up to its eye-balls in DEBT.
If the US economy slows down during the period ahead, we're going to
have a recession that you won't believe, and if that happens the
housing boom will top-out, and people will start walking away from
their overpriced homes. As for car sales, forget it, the dealers will
be giving cars away.

I've been saying for months that the Achilles Heel of the US economy
and the stock market is the dollar. So let's take a look at the
dollar. A kind subscriber sent me the very pretty chart below, showing
the Dollar Index from 1970 to the present.

The Dollar Index hit a high of 165 in 1985, the year of the Plaza
Accord (an agreement to allow the dollar to weaken). From its 1985
high the Dollar Index headed down by 1982 the Dollar Index broke below
80, having lost better than half its international value.

>From there the Dollar Index rose to 120.80 in January, 2002. But
conditions are worse now than they were at the 1985 highs. I say that
because today we have twin deficits equal to ten percent of our Gross
Domestic Product. Furthermore, short rates are a lot lower. And the
Dollar Index is a lot lower now than it was in 1984. For these
reasons, it would not shock me to see the dollar do a "repeat" of its
1985 to 1992 performance. If, for the sake of argument that does
occur, then we could see the Dollar Index cut in half again, sinking
to 60 or even below. Remember, these primary moves tend to go further
than anyone thinks possible and last longer than anyone thinks
possible.

The big question then becomes -- does the dollar decline slowly or
does the dollar start to fall apart? I don't have the answer to that
one, and neither does anyone else. But if the dollar does drop
precipitously, that will stir up fears on the part of our foreign
creditors, and if they cut back on their purchases of US securities,
that's when the trouble hits -- big time.




"Colin Bruner" <[EMAIL PROTECTED]> wrote in message news:<[EMAIL PROTECTED]>...
> And so your point is?.................Maybe you have a reason for your post
> or maybe you should stay offline when your drunk?
> 
> "consuming" <[EMAIL PROTECTED]> wrote in message
> news:[EMAIL PROTECTED]
> > fucking loser you are. cynic son of a bitch
> >
> > "FXcoach.com" <[EMAIL PROTECTED]> wrote in message
>  news:<[EMAIL PROTECTED]>...
> > > Wed Nov. 26, RECAP $1400 breakout in 2 hours! Entering the market, in
>  the
> > > direction the market was moving any time during this 2 hours brought an
> > > easy 300-$500 profit. Capturing the full extent of the move is NOT
> > > necessary.
> > >
> > > Also a quick LESSON: the most important perspective
> > > a trader can have is...
> > >
> > > To see today's new chart click on Nov 18 at http://FXcoach.com.
> > >
> > > There are now 74 people on this mailing list.
> > >
> > > Neil Albala
> > > http://FXcoach.com