DOLLAR NEXT LEG DOWN: GOLD AND OIL SHARPLY HIGHER
May 29th, 2009WARNING: This is not a recommendation to buy, sell or hold any financial instrument.
Disclosure: I own USO and gold.
WEE!
USDX 79.80 taken out hard. Gold 975.60 +15.60. Nymex Crude $66.05 +.97.
Shorter term USO longs, consider moving your stops up. Oscillators are pegged overbought. While that doesn’t necessarily mean anything, keep in mind that we are getting into a resistance zone. I’m letting mine ride for now because the dollar has broken down nicely. Look out for a bounce on the USDX anytime between now and 78.50. That thing is going to want to bounce soon.
Via: Bloomberg:
Crude oil headed for its biggest monthly gain in a decade after OPEC kept its output unchanged amid signs the global economy is recovering.
Oil has gained 28 percent in May as equities rose and the U.S. dollar weakened, spurring demand for commodities. Japan said today that its industrial output climbed the most in at least six years in April, improving the outlook for a rebound in fuel demand.
…
Crude oil for July delivery rose as much as 36 cents, or 0.6 percent, to $65.44 a barrel on the New York Mercantile Exchange. It was at $65.40 at 2:46 p.m. in Singapore. Yesterday, the contract gained $1.63, or 2.6 percent, to settle at $65.08 a barrel, the highest since Nov. 5.
Oil is poised for the largest increase since March 1999, when Asia was recovering from the 1997-1998 financial crisis and fuel demand started rising in China and India. Oil gained 37 percent, according to Bloomberg data.
