Tuesday, January 13, 2015

I hope you're enjoying this cheap oil...

Hey, did you hear? That oil stuff has gotten pretty cheap these days!

I hope you've enjoyed it, because it looks like we may be coming to a close. Why? I've been doing a bit of research and this is what I've found...

The dollar is testing all time high levels right now. Looking at the dollar chart, this is where we are...
Since the 9th, the dollar has started to slide downwards. At this same time, gold has started to trade upwards. When you add in the fact that everyone from the television analyst to your grandmother is bullish on the US Dollar it gets pretty obvious where this one is going.

Right now GDXJ (Gold) and Dollar Short ETFs look promising. Remember, it's about jumping in before the masses do, that way you buy low but sell high. As you have probably heard the markets are going through rough waters right now. A big part of this is oil and a stronger dollar. You see, a stronger dollar makes US exports more expensive for foreign countries. This is bad for Wall Street when over 30% of their profits come from the foreign market. Not only that, the #1 employment sector in the country which would be energy is cutting jobs left and right. Not only will the rich get hit if things don't slow down but so will the working class. Even though they say they're ending QE it wont surprise me to see the fed keep interest rates down as they realize economic growth is not yet where it needs to be. Inflation is BELOW where the fed wants it to be, so common sense would tell you they'll do what needs to be done to raise it.

Last but not least, Oil is literally about a dollar above one of its lows. Oil could end up shocking the market and end up coming back around $43.  I'll be watching commodities as a whole and keep my readers updated. 

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