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Thursday, March 28, 2024

Graham Summers Free Weekly Market Forecast (Euro Reversal Edition)

Courtesy of Phoenix Capital Research

Well, the Euro hit my target to a “T” at 137.5 last week. Indeed, the European currency just poked its head above this line before falling back below it again. Having gone nowhere but up since early January, this move represents not only the Euro’s first correction of any real size, but ALSO a reversal week: a week in which a security hits a new high before falling.

This reversal is even more noticeable on the weekly chart, though the correction is not a sharp one… yet.

Indeed, if this correction picks up speed, it will trigger the developing Head and Shoulders pattern I’ve been noting for several weeks. As readers well know, I believe the Euro will no longer exist in its current form within a year.

On that note it’s worth considering that should this H&S pattern be confirmed, the downside target is 118: the exact low from the June ’10 collapse. However, I think we’ll be breaking even this line and seeing the Euro at new lows below 118 before we get through the first half of 2011.

This would result in the US Dollar staging a sizable rally, not because the US’s financial position somehow improved, but simply because the Euro accounts for over 50% of the US Dollar index. So any collapse in the European currency will push the US Dollar higher.

This in turn would hurt the commodities space, which continues to move as anti-inflation hedges. However, I want to be clear here. I would not view a rally in the US Dollar as negating my forecast for massive inflation, if not hyperinflation within the next two years.

Indeed, we’ve already seen asset prices explode higher WITHOUT the Dollar falling.

These gains occurred at a time when the US Dollar didn’t fall a CENT. So the idea that you need the US Dollar to collapse in order for inflation to hit is a lie. However, at some point, the Euro collapse will end. I cannot say when, but at some point the political pressure on politicians (nearly 60% of Germans want out of the Euro), combined with a currency collapse will result in the European union changing, possibly splitting into two regions or even being done away with entirely.

When this happens, the attention will shift to the US Dollar.

Consider the US’s financial position. Our entire financial system is held up by blatant fraud. The banks don’t have anything even resembling accurate accounting. Our former Treasury Secretary and Chairman of the Federal Reserve BROKE THE LAW multiple times and have yet to face any consequences. Corruption, fraud, and even front running are the NORM in the US markets.

On top of this, the US $14+ trillion. And if you include unfunded liabilities like social security and medicare, you’re talking about $70+ TRILLION in total debt on the US’s balance sheet.




Let’s be blunt here: the US will NEVER pay these debts and liabilities off. And once the financial world finishes pummeling the Euro, we’re going to see the US Dollar and Federal debt markets implode.




I cannot tell you when this will happen. All I can say is that it will happen. And when it does, inflation hedges across the board will EXPLODE higher.




Some, like the most popular picks (Gold an Silver bullion) will records good gains. However, others which 99.9% of the investment world are currently clueless about, will go absolutely parabolic.

Buy them now, while you still can.

Graham Summers

PS. If you’ve yet to take steps to prepare your portfolio for the coming inflationary disaster, our FREE Special Report, The Inflationary Holocaust explains not only why inflation is here now, why the Fed is powerless to stop it, and three investments that absolutely EXPLODE as a result of this.

All in all its 14 pages contain a literal treasure trove of information on how to take steps to prepare AND profit from what’s to come. And it’s all 100% FREE.

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