Weekly Commentary - Feb. 28,2010

Wow...Canada wins the gold in hockey...never would have saw that coming. Let's see what this week brings. Major event for the week obviously still remains...the Greeks. Rumors are swirling like mad. But ultimately Greece will have to resort to major budget cuts which ultimately even if agreed to will lead to increased civil unrest. The President of Greece resorted to calling the Germans a bunch of Nazi's and said that they never gave back the gold that they stole during WW2. Yeah, good one...insult the very people you need to bail you out. Might be absolute coincidence but after that was said the Greek President will be meeting with Barack on Mar. 9. So the future is still unclear, however the Euro is getting very oversold and if the bailout news hits the euro will catch many people short and fly. Longer term prospects for Europe remain...Spain, Portugal, Italy...it just gets worse and worse. Dollar target remains - 90. And as far as all the people saying that the sovereign debt crisis of Greece is contained...I am having flashbacks to the whole sub prime crisis, where everyone was saying it was contained...including Bear Stearn's...saying it would not effect us. A year later they were bankrupt. I remember this vividly because I said that they would be the only firm I would work for...well that plan went to hell. In any event, watch out for the beginning of the month buy programs kick in, in addition to the usual Monday Market Levitation. A rally back above 10450...might very well be in the cards. A failure at this level confirms the top in the markets on a weekly and monthly charts. If the Greek tragedy continues the markets will not be able to take it...and will falter fairly quickly. Beware the Ides of March. Gold looks like it might be forming a nice little down channel from 1125-1025. Definitely trade-able as it awaits the break below 1000 on its way to sub 800. The most important thing right now is to be extremely flexible as short term volatility is sure to increase several times over in the next few weeks. I'm still trying to figure out how the economy is going to get back to normal anytime soon, when by the governments own optimistic estimates, unemployment will not get back to 5% until 2016. Update: Doesn't look good for the Greeks. http://news.smh.com.au/breaking-news-world/no-german-rescue-plan-for-debtridden-greece-20100301-pbj7.html

Weekly Commentary Feb. 21, 2010

What an absolutely incredible few weeks its been. Yup, I'm talking about the complete 180 degree attitude-shift toward the dollar. Anybody remember just about 3 months ago...Everyone was calling for the dollar to collapse...and the Euro would take its place, on the world stage? 1500 Pips later...now everyone is terrified about Greece and the future of the Euro. Absolutely incredible. Now the "Short the Euro" trade is getting a little crowded, and might have actually seen a climax on the "Fed Surprise" late last week. Even if the dollar still has some upside against the Euro, it is getting tired and is due for a well deserved rest...potentially carving out a few hundred pips of retracement before resuming the dollar strengthing trend of 2010. As far as the US markets...most of the retracement back to 10450 is already complete with the possiblity of one last throw over, before the downtrend resumes strongly. As such, 4/5 of the total short position will be complete this week. The final break of the markets is imminent. Get ready for things to get hectic. Good luck and Good trading. -Dio. Real time updates via: twitter.com/dioveritas

Update...Just getting back from hospital...

Just getting back from the hospital...with another bottle of morphine and steroids...sweet...lol. Back surgery is inescapable. Will be taking it easy to avoid any repeat emergencies until surgery...but I have a netbook now just in case...hehe. Complete update on markets this weekend. Good luck and good trading.

US Markets - Feb. 8, 2010

US Markets retraced a part of their fall on Friday, which coincided with the dollar weakness toward the close as positions were squared for the weekend. The next move for the dollar is to push toward the 83 area. How much the market will be able to levitate from here is questionable. Although markets are oversold...fear and safety override the risk trade. 3/5 of total short position will be complete by Wednesday. Good luck and Good trading. - Dio.

US Markets - Feb. 5, 2010

Absolutely perfect. The dollar has performed exactly as expected...pushing above 80. An absolutely beautiful run. Barring any major debt default/geopolitical event over the next few days...EUR/USD should start to retrace this latest downside move. Upside potential is dependent on where the Euro bottoms. This retracement will be the last opportunity to climb aboard before things build up speed. Each time the markets try and rally back the dollar reigns things in pretty quickly. Monday Market Levitation would coincide with the EUR/USD retracement. On the next dip trip the DJIA will hit 9600. 2010 is looking to be much more violent than 2008. 2/5 short position complete. 3/5 short position will be complete early next week. Complete update and scenarios in this weekends commentary. Good luck and Good trading. -Dio.

US Markets - Feb. 4, 2010

US dollar has finally breached the the 79.50 level. If the dollar can close at 79.50 or above for the week, it will sound the retreat for the markets...confirming a break through 10000 for the DJIA is inevitable. EUR/USD has performed remarkably...currently just north of my target of the 137.50 area...setting up for a potential retracement within the larger downtrend. Normally, I would say that it would be unlikely for the dollar to make any significant gains through Friday, however, with the unemployment report coming up...anything is possible. Will have to wait and see. In any event...if the Euro does start to retrace...it will provide for an excellent opportunity to go long the dollar in anticipation of the next leg down. So far 2010, has performed as expected...with spectacular gains for the dollar. All scenarios remain intact. Good luck and Good Trading. -Dio.

US Markets - Feb. 3, 2010

The US dollar has been strengthening since early morning...the likely hood of any significant gains in the markets is greatly reduced as a result of dollar strength. I will continue to add to the short position which should be completed at the latest by Friday...with the markets rolling back over. I will add an additional 20% when we break through 10043 on the DJIA...to total 3/5 of the total desired position. Good luck and good trading. -Dio.

US Markets - Feb. 2, 2010

Doubtful markets will be able to hold on to their gains for more than a day or two...looking forward to adding to the short position. 15 banks failed in 5 states in January. If we're in an economic recovery like the government says...I'd hate to see what a slowdown looks like. -Dio.

Intraday action: @ 2:15pm ...Began adding to short position...should be complete by Friday.

Weekly Commentary -Feb. 1,2010

The next few months will prove to be much more volatile then the last few. The markets have proven that Newton still is alive and well. But they managed to grab hold of a safety line today. If they manage to get a foothold they still can regain some lost ground back to the 10350-10450 area. If not, they will roll over fairly quickly to 9600...the last safety line...anchored by the Oracle of Omaha himself back in early November. Once we break 9600, things will get interesting pretty quick. The downturn in the markets should coincide with the dollar firmly breaking out above 80...target still remains -90. Concurrently, the EUR/USD could potentially be testing the 131 level, or at the very least be well on its way. Commodities had one heck of a rally in '09... but in 2010, much of that gain will be given back...thanks to 2010 being the year of the dollar. Once gold's rally is exhausted, 1120-1160, it will break closer toward $1000. Before this bear market is over, the government will be forced into action...this time to save their own jobs...but to no avail. -Dio.

US Markets - Feb. 01, 2010

The DJIA attempted a rally on Friday from short-term oversold conditions...managing to rally up 100+ points before rolling over and making a new weekly low. It is now Monday and the markets will try to levitate one more time. If the markets fail to gain a foothold here...we will take aim at the 9600 level before the week is out. As before...everything hinges on the dollar. The USD hit the 79.50 area and so far has bounced off...if it is unable to break this level it should setup a retracement to 78. Likewise, EUR/USD has performed splendidly, and is potentially getting ready to take a little breather...potentially getting back to the 142 area. Essentially these pauses are minor and in the larger picture, inconsequential...as the larger picture shows the direction for the markets is down, and the direction of the US dollar is up. These pauses provide excellent opportunities to add to short positions, or sell any remaining long positions. Weekly commentary will be posted tonight. Good luck and Good trading. -Dio.