Market Anthropology: Breakout & Breakdown

Wednesday, April 17, 2013

Breakout & Breakdown

Coming into the week, the US dollar index had been tracking our Structure of a Secular Low comparative quite closely – trading in a consolidating pattern beneath this past summers high.

We believe the strong rally today in the dollar is the ignition point for what we anticipate to be the second-stage breakout leg for the currency.  
And while the dollar is still trading below its previous summer highs, we believe silver is once again displaying its transcendent nature to impression where other assets may find themselves in the future. We moved forward the Nikkei comparative to align this weeks break, and continue to find congruence in how momentum is unwinding in silver. Considering the proportion of this weeks breakdown, we have also lowered the target range for an intermediate low.