Random Thoughts

Looking at the chart of the dollar, which will follow shortly, one can only wonder what the Wizard behind the curtain is doing. The dollar is making a pretty significant move to the downside which usually is a harbinger of higher yields on bonds and a declining stock market. So far neither has occurred. Here are 2 charts of the US dollar index. The first is the 13 week moving average and the second is the more significant 30 moving average. Both have crossed over to the downside.

Crossing over the longer 30 week moving average usually signals a longer term trend so I would expect the dollar to continue it's downward move for some months. Moving on to the model portfolio I'll post the chart of the proxy for the Dow which is DDM.  As you can see we are making new highs.

Next on the list is DIG which is the proxy for OIl and Gas. Again, making new highs.

From there we move on to the proxy for Gold which is GDX. Again, making new highs.

Gold & Oil should continue to move up as the dollar moves down. The Dow is a mystery as to what is levitating it as it should be going down. That segways into the observation that the stock market is no longer reflective of anything in the real world and is completely manipulated by the Federal Reserve for the benefit of the big banks and the super rich. In any event here is the chart of the Model Portfolio which is looking very good at this point. Since July the Model is up 13%. Last week we dropped TBT which is a proxy for the bond market. It has once again crossed over the moving average line to the upside but I'm going to hold off pulling the trigger as bonds are a little more volatile. If bond prices continue to drop and yields continue to rise that would be in step with a declining dollar, rising gold & oil prices and a declining Dow. The Dow is out of step so let's see what happens after the next Fed meeting. For now things are looking good.

Symbol/Name	Price*	Change	Last Trade	Gain/Loss (USD)	Shares	Price Paid	Purchase Date	Gain/Loss (USD)	% Change	% Port	Value (USD)
DDM:US ($) ProShares Ultra Dow30	72.32	+0.15	09/07	+15.00	100	66.00	07/07/2012	+632.00	+9.58	42.24	7,232.00
DIG:US ($) ProShares Ultra Oil & Gas	48.45	+1.54	09/07	+154.00	100	41.00	07/07/2012	+745.00	+18.17	28.30	4,845.00
GDX:US ($) Market Vectors Gold Miners ETF	50.46	+1.33	09/07	+133.00	100	44.50	07/27/2012	+596.00	+13.39	29.47	5,046.00
Totals				+302.00				+1,973.00	+13.02		17,123.00