- Chuck thinks it was the PPT intervening with the dollar
- Gold seems to be oblivious to the goings on around it…
Good Day… And a Tom Terrific Tuesday to you! Well, my St Louis teams didn’t fare any better last night, as my beloved Cardinals lost to the Braves, and our Blues fell to 0-2 in the playoffs VS Winnipeg… UGH! I didn’t get out to walk yesterday. At one point in the day, I looked at my watch revealing that it was 3:20, and said, “where did the day go?” I also got in trouble with little Evie, I because i saw some good-looking cookies, and took one to dip in my coffee, only to have her get upset that I took one! She’s bossy for her age, that’s for sure! Seals & Crofts greet me this morning with their song and the theme song of my H.S. Graduating class: We May Never Pass This Way Again…
Well, the dollar stopped getting sold as the U.S. currency desks came on board and took over from the Overnight Markets who had sold the dollar down the river to the tune of 10 index points in the BBDXY… The U.S. desks bought dollars and the BBDXY won back 2 index points previously lost. But still, the BBDXY ended the day down 8 index points at 1,216… That mini recovery in the dollar didn’t faze the euro, which remained above the 1.15 handle, and the euro’s strength helped the rest of the currencies to hold onto their gains too…
Gold ended the day up $99 to close at $3,426, and Silver ended up the day up 20-cents to close at $32.74… Silver was subjected to short paper trading yesterday, as I reported here Silver was up 44-cents in the early morning, only to see the short paper traders take their pound of flesh from Silver’s value… Gold is overbought on the RSI (Relative Strength Index) but, at this point, it is so far overbought, that no one is paying attention to the RSI at this point… And like I said last week, when I mentioned the RSI, Silver hasn’t sniffed an overbought price since early April, when it touched $34 and change…
I had a dear reader ask me a question about whether or not the DOGE group was every going to audit Ft. Knox… And then there was this in Ed Steer’s letter this morning: “While many are still wondering about whether or not the audit of Fort Knox is happening, it doesn’t seem like President Trump doubts the country’s gold holdings.
With gold surging through $3420/oz. for the first time ever this morning, many are pointing back to one of President Trump’s Truth Social posts from yesterday. Trump wrote on Easter: “THE GOLDEN RULE OF NEGOTIATING AND SUCCESS: HE WHO HAS THE GOLD MAKES THE RULES. THANK YOU!”.
Recall, in early 2025, Donald Trump and Elon Musk publicly questioned whether Fort Knox still holds its gold reserves. Trump announced plans to visit the site, while Musk suggested a live-streamed inspection, saying, “Maybe it’s there, maybe it’s not.”
Sounds like the audit has been put on hold for now, and that’s a sad thing, in my humble country boy opinion. Let’s get going on it! C’mon Elon… What do you need to get going on this? If this audit gets delayed, then I think it will get put on the back burner and out of the minds of ihe markets… That’s my take on what’s going on here right now…
Back in the day, when I was a foreign Bond Trader, and Currency Trader, the markets used to pay close attention to the RSI… But then something happened on the way to the forum… The dollar entered a long-term weak trend in 2003, and the RSI was thrown out the window, because every week the euro and other currencies were booking gains VS the dollar…
The price of Oil remained trading with a $63 handle yesterday, and the 10-year Treasury only added 1 BP to its yield yesterday ending the day at 4.41%…
This price action yesterday got me thinking about the last couple of times that we’ve seen the dollar get ambushed, and each of those times, it was in the overnight markets… We also had a day in U.S. trading about 2 weeks ago, that sold dollars BIG TIME, but for the most part, the overnight markets have done the most damage to the dollar…
And for those of you who keep track of the Gold/ Silver ratio.. That ration widened to 103 yesterday, which to me shows that Silver has a lot of ground to catch up, and left to its own devices it would be there lickety split but as long as the short paper traders have their say, Silver will not be left to its own devices… ,
In the overnight markets last night… well, before retiring last night, I checked the currencies, and the dollar was getting sold again, but something happened on the way to the forum last night, and the selling turned to buying… When that happens like that you’ve got believe that it was Central Bank intervention… That’s what years of currency trading taught me… So, yesterday, I was talking about the PPT not being seen in the markets, but i would suspect that they were there last night, buying dollars… The BBDXY has improved to a 1,217 figure this morning, and the euro has lost the 1.15 figure… The dollar buying isn’t to start a war over, but it’s of notice, with the currencies all backing off their perky levels they sat at yesterday..
Gold is up $33 to start our day today… I have a feeling tht I’m going to regret saying this, but here goes… Gold seems to be oblivious o everything that’s going on around it, and just keeps plugging along, moving higher, and now has its sights set on $3,500… Are you ready? This is a classic “flight to safety” move in Gold, folks… Safety from the debt scenario that questions where the financing will come from, Safety from the feud between the POTUS, and Fed Chairman, and Safety from the ill-effects of the Trade Wars…
Silver opens up this morning down 2-cents, so flat if you will… The price of Oil remains trading with a $63 handle, and the 10-year Treasury’s yield moved another BP to 4.42% overnight…
I read a report on site that wouldn’t let me read it all unless I signed up with them, but what I read was interesting in that they questioned the Fed/ Caba/ Cartel’s ability to adhere to their dual mandate of ensuring stable prices and full employment… Shoot Rudy, I thought to myself, they (Fed Heads) can’t even adhere to their target inflation rate! How are they going to ensure stable prices? Wishful thinking… I’m just saying…
Circling the wagons here, and coming back to an explanation as to why the dollar it loosing ground to the tune of 8%, it’s a combination of a couple of things… 1. The feud between the PORUS and the Fed Chairman, 2. The debt that needs to be finanaced, with bonds getting sold instead of bought by foreigners, and 2. The Sell American trade…
Shoot Rudy, even the Wall Street Journal mentioned the Sell America theme… I “took this from Moneymetals.com ” Wall Street Journal summed up:
The “Sell America” trade picked back up on Monday.
Stocks fell, with the Dow industrials dropping 1,100 points and on pace for their worst April since 1932, and the dollar hit fresh multiyear lows against the euro and other major currencies. Yields on longer-term Treasurys rose, and gold surged to a fresh record high.”
But let’s not lose our focus here, that the debt and the feud are every bit important in this dollar selling…
You know what I haven’t heard being thrown about lately? That “deficits don’t matter”… I used to cringe when I would see that in print, and it would come from people that `were considered to be “smarter than the average Bear” Idiot dolts is what I used to call them, and then I would have to apologize to my deceased mother for saying something rotten about somebody!
At least the blue light special selling of Treasuries has abated, for now… I don’t know how much longer Treasuries can remain on the sidelines while stocks, Bonds, and the dollar all get sold… I’m just saying…
This week in the U.S. Data Cupboard, we won’t be seeing much, if anything in the way of real economic reports… Durable Goods Orders will print on Thursday, but I won’t be writing that day, so there’s that… A lot of Fed Heads on the speaking circuit this week, so prepare yourselves to hear a lot of lies…
To Recap… The dollar stopped getting sold during the U.S. trading day yesterday, but still ended the day down 8 index points in the BBDXY.. Gold gained $99 on the day, and Silver fought and fought the short paper traders to eke out a 20-cent gain on the day… Chuck gives us 3 reasons for the selling of the dollar right now, and he mentions that he hasn’t heard the idiot dolts spouting off about how “deficits don’t matter” …
Before we head to the BIG Finish this morning… I want to mention that 78 years ago, yesterday, my all-time favorite country artists, Hank Williams, stepped into a recording studio and recorded: Move It On Over… I can’t say that I like much country music, but I do enjoy the recordings of Hank Willams… When I was kid at home, my dad would go through the house singing Hank Willliams’ songs… And when I first learned how to play the guitar, I sat down and learned those songs by Hank Williams, in hopes that one day, my dad would sing along with my guitar playing… But that never came to fruition, and I still love Hank Wiliams’ songs!
For What it’s Worth… weel, here’s a different take on the trade wars from a leading economist. He says that his thoughts have us entering a long period of stagflation, and it can be found here: This top U.S. economist puts the chance of a ‘stagflationary’ recession at 65% – MarketWatch
Or, here’s your snippet: “A leading economist contends a recession is now more likely than not due to the Trump administration’s trade wars, and that the U.S. could suffer the biggest “stagflationary” shock in decades.
“We may get recession, we may not, but we are going to get inflation either way,” said Adam Posen, a former official at both the Federal Reserve and the Bank of England, in a speech this week.
The influential Posen, now the president of the Peterson Institute for International Economics, put the odds of recession at 65%.
He said even if Trump strikes deals with various countries, tariffs are likely to remain in place. These measures would raise prices, increase inflation and slow the economy — the recipe for a period of stagflation.
Stagflation refers to an economy suffering from high inflation and weak or even negative economic growth. The last time the U.S. suffered from stagflation was in the late 1970s and early 1980s, a period of tremendous economic turmoil.
Even if Republicans further reduce taxes and cut regulations, Posen said, households and businesses probably won’t increase spending and investment because of a chronic state of uncertainty fostered by the Trump White House.”
Chuck again… well, every day we get another idea of what’s going to come of the trade wars, take your pick, but the one that sticks out in my mind is that of stocks going back to their intrinsic values.. In other words, stocks getting sold Big Time!
Market Prices 4/22/2025; American Style: A$ .6396, kiwi .5948, C$ .7220, euro 1.1475, sterling 1.3364, Swiss $ 1.231p, European Style: rand 18.6299, krone 10.3876, SEK 9.5214, forint 358.76, zloty 3.7807, koruna 21.8640, RUB 81.83, yen 140.40, sing 1.3083, HKD 7.7676, INR 85.19, China 7.3134, peso 19.56, BRL 5.7962, BBDXU 1,217, Dollar Index 99.56, Oil $63.92, 10-year 4.42%, Silver $32.72, Platinum $967.00, Palladium $946.00, Copper $4.84, and Gold… $3,459.66
That’s it for today… Yesterday, was my good friend, and former Big Boss, Frank Trotter’s Birthday! He’s now 1 year older than me again… I bet that Frank’s new endeavor, Battle Bank, is oh-so-close to opening its virtual doors, that he can taste it! The patience of this man is incredible… If it were me, I would get the FDIC on the horn every day, asking them when they were going to make final decision! Good thing it’s not me! I would make a mess of everything! What’s gotten into my beloved Cardinals, who can’t beat “bye” on the road? They’ve wasted a ton of great starting pitching with weak bats… UGH it’s going to be a long season, I’m afraid… The late Great George Harrison takes us to the finish line today with his song: While My Guitar Gently Sleeps… I hope you have a Tom Terrific Tuesday today, and please Be Good To Yourself!
Chuck Butler