A Period of Realization is Evolving in the Stock Market…

But first lets take a look at the Dollar. I don’t talk about the dollar often as I view it as more of a catalyst than a trading vehicle. Back on July 20, 2023 we pointed out that the dollar appeared to be bottoming, getting close to the annual forecast level set on January 2023 at 97.00. It did bottom out at 99.50 and then bounced to the 107.00 level this past October. Since then it has settled back into what I would call the 101.00 support zone. Obviously interest rate levels factor in to the calculus but since we expect rates to consolidate above the 3.5 – 4.0 support level, the Dollar has room to play for higher levels. We will be watching closely, see chart here. All in all, it probably makes owning Gold a risky proposition from here.

Getting back to the Stock Market. We are now in the realization phase where the small caps are being bought as shown by the breakout last Friday.