07/27 Market Update; What’s going on with the US dollar and gold?

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-The reasons the USD are falling have less to do with collapse and more with the central management of this global system.
-The US Fed was the primary central bank that needed to engage in the financial and monetary responses to the Coronavirus crisis. It needed to flood the world with dollars and engineer a collapse of the UST yield curve. –Pre-pandemic, the UST yield curve was much higher than those of the other developed nation states. This needed to change immediately and the Fed was successful in achieving its goals. It needed to weaken the currency as well.

The euro has been rising versus the USD in the futures market and I see an imminent test of the 100-week mva (1.1904)

-The USD has weakened and the yield spreads have collapsed as a result of the massive Fed intervention. These were the Fed’s initial objectives as part of the centrally managed global monetary system.

-Given that UST yield spreads as well as the Fed funds rate both collapsed and the USDX is still around 94 is testament to the systems resilience.
-The US economy is not performing any worse than the other economies. The US GDP growth forecasts over the next year place the US in the top half of the developed nations.

GDP growth forecasts for the Eurozone are actually weaker than those for the U.S..

-The euro has risen against the USD as the ECB kept sovereign bond yields relatively stable over the past year. The ECB overnight lending rates have not dropped in response to the coronavirus pandemic. The Fed funds rate has been slashed to weaken the USD and help engineer the collapse of US bond yields.

The US Fed funds rate has dropped to zero bound while the ECB’s three primary overnight targets have remained constant. Now the ECB can engineer a further cut to their rates.

-Based on past behavior, I am looking for the USDX to fall to its lower-end five-year trading range before the other central banks engage in bond buying with the intent to collapse their yield curves. This would imply German and Swiss 10-year bonds at -100 bps or lower.
-Beware of the gold shill by Zerohedge and GATA. If we employ their non-sequitur logic we won’t understand why gold is rising and will continue to make the wrong financial decisions. MSM is blaming souring American-Sino relations for gold’s increases, but that is just the next ongoing manufactured crisis of the banking globalists. The real cause: massively accommodative monetary policy. This policy will continue until the system’s terminus. We have perhaps a few more years until the Fed’s balance sheet approaches 100% of GDP.
-The ECB has plenty of room to add to their balance sheet as their economic growth looks to actually be weaker than the US forecasts.

Based on past performance and even weaker economic prospects, the EU will need the ECB to begin cutting bond yields by adding to its balance sheet.

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