Last Wed I sent out emails and text messages warning people of a possible collapse of the European banking system as early as this Monday. Looks like that is NOT going to happen. The Asian markets have rallied (SPX futures up 6) on some of their own numbers but the main reason is that they are confident in European money printing to be sufficient to stave of a full blown crisis. But you must remember back in March they had averted a crisis and then Greece was given a second bailout not too long ago and we were lead to believe that there will be no need for more bailouts. And now we are hearing the same thing. However this time things are quite a bit different. Take a look at the charts below.
August through to the early parts of October the EUR slid, take a look at the Commercial short positions at that time and compare them to the current situation. The large commercial banks are making huge bets as of last Friday that EU is going to be okay and the Gold and Silver COT are indicating that bailout (or QE) money supply whatever you'd like to call is coming. Its now going to be a matter of size.
Looking a the red bars on the MACD histogram and right at moderate support one would think that the dollar should bounce here but the commercials are betting the other way and you combine that with bearish dollar short (large commercial position) you have a chance for stocks, gold and silver to take off.
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