An ambush for the ages

• The Dollar gets sold down the river, in the overnight trading.

• Potus VS Fed Chairman... Who will win?

Good Day... And a Marvelous Easter Monday to you! Well, if you celebrate Easter, how was yours? Mine was great! All my kids and grandkids were here, along with some extended family! We've got more chocolate here than Carter has pills... I don't think it will be good for me to eat a lot of it! I guess the grandkids filled their baskets and that was it... We'll have to have them back to gather some more, because I'm not going to consumer all that chocolate! Little Evie stayed the night with us, and is here for the day today... I need to stay away from here for the most part, because I always end up with an ailment after she comes here... I'm just eliminating one thing... Gotta find out why I keep getting sick! Johnny Rivers greets me this morning with his song: The Poor Side of Town...  

The dollar continued to get sold going into last weekend, but not as badly as one would think given the bad economic reports on Thursday... The BBDXY ended the week at 1,224... That's a 6.5% loss when measuring the BBDXY YTD... Gold ended the week on a down note, but it's important to point out that Gold is indicating that it is in overbought territory in the RSI (Relative Strength Index) ... Usually, that would have Gold getting sold until it was no longer showing overbought...  Gold hadn't shown any resistance from being overbought, so either it was that, or profit taking, or... Short paper trading that caused Gold to end the week down $14, and to close at $3,327...  

I find it very promising that Gold has remained well bid in an overbought position in the RSI... the selling on Thursday doesn't turn out to be short paper trading, it would indicate that Gold is resilient to the RSI Index... Silver hasn't sniffed an overbought position in the RSI since earlier this month, and that's when the short paper traders used the RSI reading to take Silver down violently.... So, Silver ended last week at $32.68... up on Thursday 15-cents...  Friday was a markets holiday (Good Friday) and only the Gold market in China was open, and Gold didn't do anything there...  

On Thursday last week, the European Central Bank (ECB ) did what they said they would do, and that is cut rates... They Cut their internal rate 25 Basis point (1/4%) to 2.25%. This was the ECB's 7th rate cut in the last year! They (the ECB ) truly believe that the coming tariff war is going to cause inflation to return to the Eurozone... I've got a bridge I would like to sell them, if they're that naive... where have all the rate hawks gone from the Bundesbank (Germany's Central Bank) and the De Nederlandsche Ban (The Netherlands Central bank) gone?  The euro didn't lose any ground on the rate cut news... Which proves my statement to you years ago, that the euro is the offset currency to the dollar, and with that moniker the euro gets to rally even if the economic news in the Eurozone is bad...  

Years ago, in a glazy far away, I was the foreign bond trader at Mark Twain Bank, and I used to write in the Pfennig then that I didn't understand why the Bundesbank wasn't cutting rates... See how I've changed? Once I also took on the currency trading to go with my bond trading, I saw the error of my ways... And that rate cuts weren't not good for the currency, for they equaled a debasing of the currency...   

I mentioned the bad economic reports above, and if you can't wait, go ahead and take a peek at the U.S. Data Cupboard piece below...  

The price of Oil bumped higher again late last week to end the week trading with a $63 handle... And the 10-year's yield bumped higher to end the week with a 4.33% yield...  President Trump is blowing the horn for rate cuts, and it's for good reason as far as the Gov't's books are concerned... He feels that if rates were cut, the yield on Treasuries would drop, thus brining the cost of servicing the bonds down... Shoot Rudy, the cost to pay the interest on the bonds now is more than we pay out to the Defense Budget..  And it will be even costlier in 2026, and so on...   

You know, there's no guarantee that Treasury yield will come down if there are rate cuts... Remember last fall when the Fed Heads cut rates 3 times, but Treasury yields rose?  I kept pointing that situation out to you dear readers, saying that the Bond Boys were saying that they didn't believe that inflation had been defeated (at that time it was 2.8%, and nowhere near the Fed's 2% target rate)...  So, you can't hang your hat on yields coming down if there are rate cuts... I'm just saying... And if I were Jerome Powell, I would be pointing the scenario that took place last fall, out to the POTUS...  

In the overnight markets last night... OMG! It's an ambush of all ambushes! The dollar is getting sold like it's the Zimbabwe currency! The BBDXY is down 10 index points this morning, after a night of selling. The euro has climbed to a 1.15 handle, and the rest of the currencies are all looking perky this morning. What's got the traders and investors selling dollars now? Well, it seems the markets didn't like the back and forth between the President and the Fed/ Cabal / Cartel chairman over his status as chairman...  They think it hurts the dollar as a safe haven, and so the dollar gets sold down the river... Go ahead and take a peak at the currency roundup below and see for yourself the damage to the dollar... 

And Gold? The real safe haven, and not some fly by night, investment, is up $75 this morning, and climbed above the $3,400 figure! Silver is joining in and is up 43-cents to start the day/ week this morning. This is one for the ages, folks... So, mark this down in your daily journal as a day that sent the dollar into a new weak dollar trend... There I said it!  

The price of Oil remained trading with a $63 handle overnight, and the 10-year Treasury's yield has jumped higher with the dollar getting sold, and the 10-year's yield sits at 4.40% this morning...  That's up 10 BPS from where it closed last Thursday... 

I spent an hour listening to a James Rickards message this past weekend... I don't know why I do that, it always leads to the same conclusion, "join my letter for 'X' dollars, and I'll send you the report"... I tell you this so 1. You won't fall for these things, and 2. That he made a good statement about raw materials here in the U.S. that have been protected by dumb legislature for years. No, instead we, as a country, import these raw materials, and pay quite dearly for them, when we have oodles of raw materials in the ground here in the U.S. that haven't been touched...  Well, that's about to change... 

It was reported by the good folks at GATA this past weekend that the POTUS has approved 10 new mining projects here in the U.S. This could be a game changer for the U.S. folks... We had better keep our eyes on this development, don't you think? I do... I'm just saying... 

So, as you can see, I don't make this stuff up!  

I can't think of anything else this morning, except for the dollar getting sold down the river.. This is a long time coming, folks... All the pent-up frustration as the dollar gained when it shouldn't have... There have been days when I didn't even want to write about the dollar and its rally... But with the dollar down more than 8% this year, that appears to be over.. The PPT and their treasure trove of funds that have been used to save the dollar in the past, have been absent from the currency tradeing, and that's very suspicious to me, but I say "leave sleeping dogs alone"  

And the POTUS and Fed Chairman, going back and forth, doesn't help things... The POTUS wants to fire Jerome Powell, because he won't cut interest rates... Now this is nothing new, but has been brought to a head, because of the overall meanness that has been brought to the table... Here's Bloomberg.com this morning: "“Firing Powell not only undermines the principle of central-bank independence, but risks politicizing US monetary policy in a way that markets will find unsettling,” said Christopher Wong, a strategist at Oversea-Chinese Banking Corp. If the Fed’s credibility is called into question, that could erode confidence in the dollar and accelerate flows into havens, including gold, he said."

I got a kick out of that last part regarding The Fed's Credibility being called into question... Did they have any credibility left? I would have to argue that point, because I feel that when the Fed Heads cut rates three times last fall when inflation was nowhere near their previously stated target of 2%. The remainder of their credibility was lost... I'm just saying... 

And the guy quoted in Bloomberg. Com above, is a little too late for the party, because those flows are already into Gold...  But that's the problem with coming out with a statement, it's old before you finish it! 

Oh well, I just say, "can't we all just get along".. Apparently, no is the answer... And that's a very sad thing in my opinion... 

You know, Easter Monday used to be a holiday for yours truly, back when he ran the currency desk at EverBank... Good Friday, and Easter Monday were always taken off. I didn't think that I needed to work on days that were so important! To me that is...

The U.S. Data Cupboard ended last week with some awful numbers that didn't help Gold any... First, we had the Philly Fed ISM (manufacturing for the region) and it came in a negative -26.4... and then we had Housing Starts come in for March showing an 11% drop...  Both bad numbers as far as the economy goes... And that should have gotten the rate cuts bugs crawling out of the woodwork, but the only rate cut bug that made everyone feel queasy, was the POTUS, who claimed that he was going to throw Fed/ Cabal / Cartel chairman, Jerome Powell, out with the trash... Powell, basically said, "Come and see if you can do that!"  in truth, I made that last part for Powell up, but I sure imagined him saying it! 

This week's Data Cupboard is null and void of real economic reports, after starting the week with the leading Indicators, which have been mostly negative for months now... 

To recap... The dollar is getting sold down the river this morning folks, as it was ambushed overnight, and the BBDXY is down 10 index points to start our day/ week this morning. The euro has climbed over the 1.15 handle, and Gold is up $75 to start the day/ week! The dollar is getting sold because its safe haven is being called into question, and that is derived from the bickering that's going back and forth between the POTUS and the Fed/ Cabal/ Cartel chairman... Chuck thinks that this day should be an entry in your journal... 

For What It's Worth... Well, I spent a lot of this morning talking about the dollar selloff, so I think it apropos to have the FWIW continue that thought.

Here's your snippet: "The U.S. Dollar Index is testing a key technical level that has triggered major rebounds in the past, making this an important setup for commodities and precious metals investors to watch closely.

The U.S. dollar has fallen sharply since the start of the year, which has boosted commodity prices, especially metals like gold and silver, due to their inverse relationship.

This decline stems from several factors, including a plunging stock market that triggered foreign capital outflows, rising recession risks and expectations of future interest rate cuts, and growing uncertainty over America’s new tariff policies.

But after three months of steady declines, the dollar now finds itself at a key crossroads—one that will significantly influence its next move, as well as how commodities and precious metals respond from here.

The crossroads lies in the fact that the U.S. Dollar Index—a measure of the dollar’s exchange rate against a basket of major world currencies (not its domestic purchasing power)—is now sitting right at a major long-term support level around 100.

This level has held for several years and has triggered significant rebounds in the past, including the most recent bounce in September 2024, which created a headwind for metals over the next few months.

How the U.S. Dollar Index behaves from here will have a major influence on the direction of commodities and precious metals.

A decisive break below this level would likely open the door to a deeper decline, potentially into the low 90s or even lower, which would be highly bullish for commodities and could propel gold toward the $4,000 mark and silver to $40-$50+.

However, if the Dollar Index finds solid support at the 100 level, it’s likely to bounce, which would pose a headwind for commodities. That said, I believe gold, which remains in a strong uptrend, would likely consolidate and cool off rather than experience a sharp pullback. "

Chuck again... Nothing more to add to all the talk this morning regarding the dollar and its current situation... 

Market Prices 4/21/ 2025: American Style: A$.6424, kiwi .6010, C$ .7242, euro 1.1542, sterling 1.3395, Swiss $1.2417, European Style: rand 18.7037, krone 10.3958, SEK 9.5009, forint 352. 84, zloty 3.7039, koruna 21.7020, RUB 81.20, yen 140.70, sing 1.3092, HKD 7.7602, INR 85.17, China 7.2893, peso 19.70, BRL 5.8268, BBDXY 1,214.57, Dollar Index 99.56, Oil $63.20, 10-year 4.40%, Silver $32.99, Platinum $978.00, Palladium $963.00, Copper $4.84, and Gold... $3,404.83.

That's it for today... I finally got out of the house for a little time last Friday, that wasn't sitting out back, reading, or going for a short walk... I got to be with my friends, Rick, Duane, Mike, Denny, Kevin, Lisa, and Debbie, Nancy, and Kathy went with me! I hadn't seen some of those folks since December, so a lot of catching up was due... I was supposed to be going to lunch with my classmates this Thursday, but that's the day I'm due for my next infusion... So, there will be no Pfennig this Thursday, as I will be getting my next infusion... It was an awful weekend for St. Louis sports... My beloved Cardinals got swept in NY, Our Blues lost their first playoff game, and the City soccer club couldn't score again... UGH! Our Blues had the lead with 10 minutes left, and then they didn't... Just like that! I was so frustrated with their play in the 3rd period.... Oh well.. We move on... Jackson Browne takes us to the finish line today with his song: Ready Or Not... I hope you have a Marvelous Easter Monday today and will Be Good To Yourself!