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King Dollar
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King Dollar

by The MoleJuly 12, 2018

The great trade war of 2018 is officially on after months of increasingly belligerent and often hate filled responses by clearly dumbfounded political leaders over in China as well as the European Union. Frankly I sometimes have to pinch myself in the morning just to make sure that I am not in fact living in a cheesy episode of the Twilight Zone in which common sense and rational thinking have become relicts of the past.

Look folks, this is very very simple, so let me explain the situation in one single paragraph. If you run massive export dependent economies, like let’s say semi-communist China or aging hippy Germany, that largely depend on an equally massive consumer base abroad, like for example the United States of Glorious Asskicking, then demonizing that very consumer base your economy depends on is not exactly a good idea.

In fact after the slew of indignations and petulant responses coming out of Germany in particular over the past few months I myself would not ever buy a single German car again, and I was born over there for crying out loud! No matter what the bureaucrats in Beijing, Brussels, and Berlin may be publicly stating or implying, deep inside they fully know that their are hopelessly outgunned here with zero leverage and potentially horrific long term consequences to their respective industrial bases.

Mark my words, this is going to end in tears with all out dry eyes West of the Atlantic. The Germans and the Chinese in particular are about to screw themselves in a major way with little recourse of ever bouncing back economically in the foreseeable future. What our trade ‘partners’ ought to finally start realizing is that the U.S. economy is ready to kick itself into 5th gear, whilst at the same growing less dependent on foreign exports plus becoming effectively independent of foreign energy imports. I’m not saying that a full scale trade war won’t claim collateral damage on the U.S. side but the long term impact will be felt much more intensely abroad.

Neither the Chinese nor the Europeans can win this one and while I understand the political bind the Chinese are in to some extent, I am almost embarrassed by the amateurish and outright silly attempts of political brinkmanship coming out of Europe. Haven’t they learned anything over the past two years? You cannot bullshit a bullshitter!

Now with most things in life all you need to do in order to get to the truth of the matter is to simply follow the money. That’s all what we do here at Evil Speculator because money talks and bullshit walks.

And while the TV pundits are busy spouting ideological opinion pieces everyone and their grandmother is scrambling for U.S. dollars. This right here is the DX on the brink of a break out attempt. If it succeeds and the daily NetLines near 94.5 can be overcome then a run into 95.5 and higher is almost procedural (barring of course any action by our friends at the U.S. Fed).

The long term chart shows the Dollar at both a weekly and monthly inflection point near ~94.5. A take down of the Dollar would have to be happen right now as continuation higher establishes the recent correction as a bonafide retest and also a support zone for the foreseeable future.

Here’s the USD/JPY which has now arrived at its own inflection point near 112. This represents the upper range of a slightly falling sideways flag which now coming into sync with the upper 100-week Bollinger. Keep in mind that the 100-week SMA has already been thoroughly retested and IMO only central bank intervention here (by the Fed not the BOJ) would throw a monkey wrench into a continuation of this advance.

Speaking of collateral damage – crude fell like a rock yesterday which in turn sealed the fate of my long campaign I took out last week. However it’s an entry I would take every single time given a similar break out pattern. You can’t win ’em all but you can try!

My E-Mini campaign is starting to look a lot better again but thus far there is little to do until we see more decisive follow up to the current crawl higher. The 100-hour SMA is now  > my trailing stop which should act as a first line of defense on another take down attempt.


About The Author
The Mole
Mole created Evil Speculator amidst the chaos of the financial crisis in early August of 2008. His vision for Evil Speculator is a refuge of reason, hands-on trading knowledge, and inspiration for traders of all ages and stripes. You can follow him and his nefarious schemes at the usual social media waterholes.
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  • StockTalker

    /YM is at 50% of EMM (24886) and crude has rallied. Shorted both again

  • https://evilspeculator.com Sir Mole III

    You were the one who shorted crude, right? Congrats!

  • StockTalker

    Yes, bigger move coming me think

  • StockTalker

    How do you like that dollar now?

  • HD

    Nice blog today. A few things to consider. Everything in America is going to cost more as a direct result of his trade war. We like things cheap. We lose that. The other riskier problem is we owe China $1.5T. Piss them off too much and they could dump the treasuries and that would cause some discomfort too.

  • StockTalker

    Expecting it sooner than later with interest rates moving up. She is going to blow hard.

  • StockTalker

    We are at a critical juncture here, get your thinking caps on.

  • HD

    I’m a seller into 2800, again

  • StockTalker

    Watch crude, if red by open will not get that chance. Sellers open today.

  • HD

    As long as it stays below 72.50 IMO

  • HD

    The Germans make nice cars. They are roughly 1/4 population of US. How can you expect imports to be balanced?

  • StockTalker

    Crude is in big trouble here below 70.

  • StockTalker

    /ZW looking good here as well so far.

  • StockTalker

    Shorted /NQ

  • StockTalker

    Lord, let this be a W3:)

  • StockTalker

    -2 /NQ

  • HD

    Long IQ, looking for 40

  • HD
  • bankwalker

    ouch!

    What is driving /NQ?

    /ES, /YM, and /RTY not confirming.

  • StockTalker

    In 17 AUG 18 160 P 100 @ .48

  • StockTalker

    Blood today, just bought QQQ puts as well.

  • bankwalker

    /RTY barely hanging on …

  • StockTalker

    Count is full on /NQ, down she goes.

  • ridingwaves

    green blood obviously…heading much higher…..your stuck in a moment you can’t get out of….2862snp coming…

    https://www.youtube.com/watch?v=Xqrn2q3WCS8

  • Darkthirty

    There’s ALWAYS 2 counts……………..

  • Julie 35 – 25 – 36

    USO Yesterday I posted 14.13 as one of my targets. Today’s low 14.15 … JULIE https://uploads.disquscdn.com/images/87d64f06a80e4ae2328986bf578d785facca5912a69d01f35191ba54a2b8c830.png

  • Darkthirty
  • HD

    Yes sir! Very rarely take an equities trade. Gotta love it when they scream higher immediately. $33.50

  • HD

    I’m impressed. Oil is the tuffest product to anticipate. Nice work!

  • Julie 35 – 25 – 36

    HD Checkout EXAS Looking to short a lower high .. A back https://uploads.disquscdn.com/images/e2c5c3d9d959c710360e355d6d06426f188378677a08ddf6ecd9f312ae836dfb.png test of a broken lower channel trend line ; 50% retracement and baseline (21) approx 65.05. The bounce looks corrective i.e. 3 waves JULIE

  • HD

    So plan A is still low before OPEX, 3 day hit, B wave down before final C up rally. If below 2742, wrong.

    That’s your ABC’s. Got the text. Golf in Sedona. I guess there is yoga there too so the lady is happy. En route.

    Have a great weekend.

  • Julie 35 – 25 – 36

    HD Drive safe and have a great weekend. Thanks for your charts
    JULIE

  • Julie 35 – 25 – 36

    SPX above 2800 resistance …. 2850 channels nice But we all know 2875 will be retested to get all the bulls in plus Ma and Pa and Joe Sixpack. The game now is distribution to the uninformed and Johnny Come Latelys JULIE https://uploads.disquscdn.com/images/9282870ecf7404815da5ea5df5b6da4878647b9443d040fd72fe8c3de560bb4c.png

  • BKXtoZERO

    There they go…. 2 nights ago a few others on here all said the drop looked like a normal 4th kind of a pullback. I agreed and was ready to sell VIX at the open, then there was the usual intervention to make a 30 point drop a 20 point drop, then chop after the open to keep you guessing. I can see how bulls start to feel confident and trust in the MKT. I bought some USLV yesterday at 8.6. Standing aside on VIX waiting to see what kind of blow off rally we may get.

  • Julie 35 – 25 – 36

    Hi BK SPX looking at the April low and subsequent advance it appears to be a large diagonal. Our Chief will scold me on this but it is what it is. Again I do not count as stated many times previous Have A Great Weekend BK
    JULIE

  • BKXtoZERO

    he he he he

  • Julie 35 – 25 – 36

    Chief Thanks for your viewpoint on the trade war. I very seldom state my views on economics BUT I agree with you. The U.S. will win this and bring Europe and China to their knees. Yes we will endure some pain but it’s time the U.S. kicks butt Thanks Chief
    JULIE

  • https://evilspeculator.com Sir Mole III

    That’s more like it!!

  • BKXtoZERO

    Plus 1, everyone will cry but we are getting beat now….

  • Julie 35 – 25 – 36

    I believe RW stated an interesting fact. We do not need anything that China exports to us. Cheap Christmas crap every year and toys ! They don’t exactly send us farm machinery and industrial products. I don’t care about a Chinese washing machine or anything else made in China.
    JULIE

  • ridingwaves

    these countries have no leverage, the US has the lowest Tariffs in the world of all the real economic powers..even with the new tariffs…

  • bankwalker

    The trade war has been going on for many, many years. The USA is finally fighting back.

  • ridingwaves

    I could start a screaming band with much better lyrics…..those who lived thru the real punk era laugh at these metal junkies….

  • Julie 35 – 25 – 36

    MOS I showed this chart previous thread. Looking to go long support zone 27 – 28. Needs a bullish close above 28.35 ( conversion line (8) ) today’s high 28.36 JULIE https://uploads.disquscdn.com/images/ea77cedac7fa4fe357c10ca6da7809992e5f68bdde98aa31aef97890d752a546.png

  • StockTalker

    /NQ with a new high, marvelous. We are finally there. /NQ only red position but think we sell off remainder of the day.

  • Julie 35 – 25 – 36

    SPX STOCHS now embedded …. Go to STOCHS 6,3,3 with a 30 weighted moving average. Breaks below the 30 weighted moving average . If your platform does not allow you to insert a moving average on the STOCHS go to freestockcharts.com. It is live trading
    JULIE

  • https://evilspeculator.com Sir Mole III

    I’ve been watching this for over a decade waiting for someone to take action. It’s time to stop being taken advantage in particular by f…ing China.

  • https://evilspeculator.com Sir Mole III

    I take it a step further: I would happily pay a significant premium to once again see QUALITY products designed, manufactured, and supported in the U.S. I still have gear and tools from the 1990s that’s built like a tank and will probably last me another 20 years. All the Chinese crap I’m forced to buy falls apart in about one year plus minus.

  • Julie 35 – 25 – 36

    SPX A short possibly setting up. A bearish close below the center Raff Regression line (solid red) and the daily 5 ema approx 2777 Watching like a hawk JULIE https://uploads.disquscdn.com/images/e3bf2993172febd49a841ac46bdf604473a815e5ec758cf75da651d5f2790069.png

  • https://evilspeculator.com Sir Mole III
  • https://evilspeculator.com Sir Mole III

    Julie – have you used TC2000?

  • Julie 35 – 25 – 36

    Chief I have had it for a long time I believe I downloaded Silverlight
    JULIE

  • Julie 35 – 25 – 36

    No chief … I downloaded Silverlight It has been a while
    JULIE

  • https://evilspeculator.com Sir Mole III

    I used to run Silverlight when Netflix was using it and worked fine. Not sure I would trust it with my trading activities though…

  • ridingwaves

    on what basis? the fear index is screaming bullishness…..everyone is trying to short the market that is climbing based off earnings not some fed hopium….Earnings talk…..along with the safety of us equities right now, foreign money is pouring in…

  • Julie 35 – 25 – 36

    Chief Again Thanks For Everything that you do for us. Never goes unnoticed Chief
    JULIE

  • bankwalker

    freestockcharts.com uses BATS data and you get BATS volume only. You will not see trades that execute on other exchanges. In thin markets you may not be seeing the latest price.

  • Julie 35 – 25 – 36

    INTC Getting ready to re shprt https://uploads.disquscdn.com/images/7e68c07499b7f058bcf777ca1e369a2b3610b37a9e71b819e18870754a6297e4.png again .. Now attained a target … 2nd target 50.03 JULIE

  • Mark Shinnick

    Appears that AAOI OptoElectronic is launching out.

  • Darkthirty

    Angry white boy music? That be rayciss

  • ridingwaves

    so rap is angry black boy music….its all just individual expression…..no coloring needed…..too funny you are….

  • Julie 35 – 25 – 36

    GVIP “Hedgies” holding the daily 5 ema. Going to ride https://uploads.disquscdn.com/images/43e2f361140a08ff5b4090f25bdb3a2ea2ace7d1be93bc9affea4c29077e41cd.png their coattails. Will short a bearish close below the 5 ema On sidelines SPX JULIE

  • Darkthirty

    Caucasians are “privileged” they have no right to be angry……..

  • ridingwaves

    that setup was so sweet, I hope you took advantage of it. 10000+ different trades in the market….just need to find the diamonds…..what a year it’s been….I seem to fall on death ears in this forum with some setups and symbols because of index infatuation. Trade diversification is the key to success, too many locked into one thing only….

  • bankwalker

    groupthink

  • Julie 35 – 25 – 36

    Hi RW You nailed AAOI at he trend line support and 38.2% retracement . Nice call RW Good trade ! JULIE https://uploads.disquscdn.com/images/c3211fc184452291d31c122c27465f91f69ebf546f8763f7cf438865a1bc6905.png

  • ridingwaves

    yeah, I guess the serfs should have been whistling while Longshanks was fucking their wives and enslaving them… you are too funny and wrapped up in some place where reality seems to bypass…..all races have been screwed thru-out history…..go cry a river in the desert, they are dry….

  • ridingwaves

    good to be lucky and just open to all things the market, its a living breathing thing, hanging out with just the finger is boring…

  • Darkthirty

    Don’t suppose the wops, micks, or chinks are Caucasian….

  • Julie 35 – 25 – 36

    Not Luck RW You are a good trader and do due diligence. Luck is when opportunity meets preparation which you do
    JULIE

  • Mark Shinnick

    Yea, really my kind of setup.

  • BKXtoZERO

    I stay away from single stocks period but perhaps I will start taking some small positions in some of your gems.

  • Julie 35 – 25 – 36

    FLR Nice consolidation. A breakout could have a nice run. Will buy at approx 47.50 if it holds. If not then the breakout watching volume JULIE https://uploads.disquscdn.com/images/45652944cffda5dec0e613ef8cd491a6f246a983ee5756c6336259f81331f5d1.png

  • ridingwaves

    I’m not a good trader, I’m just open to all things market…..the indexes have been from Mole’s post above not the easiest to trade, yet, within those indexes is a basket of opportunities….find them, either short or long and its fun….
    Ex-Monday ISR has a huge volume in first hour, blew away average volume, so I went in and found press release from year a go on gamma ray tile fda action would be about a year….wala, no news, huge volume etc….timing was right by press release…they had approval or not, didn’t matter, nobody new, it came down after initial bursh, got in at .65 and sold after hours at 1.22 because they did halt during trading hours and released approval, everyone was climbing in after hours to get on board to riches, cant miss out….I sold into that….10R’s in a day on a dollar stock…News matters there….they announced atm afterhours….you can buy it at .62 again

  • ridingwaves

    thank you though, see below

  • Julie 35 – 25 – 36

    GLD Going to buy a very small position. Oversold lower channel play. July 2 may have been a selling climax JULIE https://uploads.disquscdn.com/images/3b054ffde45365ce899c5cecf80d768cfb29e4611b2cce171d3c625af8b79922.png

  • ridingwaves

    getting close, if they have good earnings that gap might be filled with a bullish trend….1.8 yield…its in a very interesting place right now on weekly and daily….maybe Earnings release is catalyst…I might jump in after ER…sitting on 200sma monthly…..

  • Mark Shinnick

    You are fine IF this continuation game persists. Otherwise, the stop is immediately below so a well-defined risk….in theory. Consideration there is the massive energies that look to be released pretty soon.

  • Julie 35 – 25 – 36

    Hi Mark GLD 117 is the target from the decline at the double top . 129 – 123 = 6 … 123 – 6 = 117
    JULIE

  • Mark Shinnick

    I see a mid-121 local objective, but the R/R ratio in my preferred 3x miners is very poor.

  • Julie 35 – 25 – 36
  • Julie 35 – 25 – 36

    Sitting in for GG …. Time Check .. 9 min to go ! Everyone Have A Great Rest Of Day ! Must get back to work
    JULIE

  • BKXtoZERO

    I finally entered my holding period as in, no more trading, bought USLV at 8.6, from here on out I am building a rather large position in metals through end of July and we’ll see if August is another down month. I plan on sitting on it, not trading…. months to a year view

  • https://evilspeculator.com Sir Mole III

    Thanks darling!

  • https://evilspeculator.com Sir Mole III

    Thank you Julie – I do it for hardcore traders like you 🙂

  • http://www.captainboom.com/ captainboom

    @ridingwaves:disqus Can you ping me via email? andy at captainboom dot com
    I’ve got a bio company I want to run past you.

  • https://evilspeculator.com Sir Mole III

    And you’re holding out on the rest of us? 😛

  • http://www.captainboom.com/ captainboom

    Yep, for now. If it’s worthy, I’ll share it.

  • ridingwaves

    done….

  • Julie 35 – 25 – 36

    EXAS A possible re https://uploads.disquscdn.com/images/6d5231fa9f929ec1d883ef998f0d3050b24b3a6ce12199a4fa71035444c984db.png turn to the scene of the crime i.e. the breakout at 53 matching the daily 144 ema JULIE

  • Mark Shinnick

    Where is this viewpoint….is it a majority one with all the good and valid PM justifications but without price action support?

  • BKXtoZERO

    sheez I am e-mailing too!

  • BKXtoZERO

    Seasonal trend is very strong, low in July/August, the gold silver ratio is at an extreme which has a history of being favorable to silver. I am also hearing of physical demand jumping at the moment trying to lock in prices here. That I need to read more on…. The dollar tear cannot go on forever. https://uploads.disquscdn.com/images/bd5961caee928bd7b9d76b743d55359b1ef4f1e78e050d6bb893162f60741330.jpg

  • Mark Shinnick

    There now also exists a developing inflation narrative.

  • BKXtoZERO

    I also see that smart money hedgers hold their lowest short position size and non commercial shorts are at all time highs

  • Mark Shinnick

    When not kept rigorously tongue-in cheek, the reflexive anthropomorphism is friggin insane.
    https://youtu.be/Io6xuGmS5pM

  • https://evilspeculator.com Sir Mole III

    So even robots are full of shit. Great…

  • StockTalker
  • Benson Burns

    That is the most positive analysis of the trade sitch I’ve read. I effing love it.