Most of the positive action likely to run into January has been accomplished in a sensational rally. News about the Euro "fix" was made as pretty as possible – prompting a huge short squeeze.
More detailed analysis of the "fix" suggests the book is not as attractive as the cover. There has been one day of general selling in stocks, commodities and corporate bonds. The DX closed at 75 on Friday and is now at 76.2. Rising above 76.7 would set a near-term uptrend.
As a monitor of good or bad things, the gold/silver ratio has turned up a little today. The low was 49.4 on Thursday and Friday. The advance has been to a little above 50. Not much, but if it rises through 53 it would signal another phase of the liquidity crisis.
Another item to watch is the attached chart on ten-year Italian bonds.
10-Year Yields: Italy
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