The Massively Bearish Psychology is changing

Posted by Dennis Gartman - The Gartman Letter

Share on Facebook

Tweet on Twitter


This brief initial comment  from the Legendary Trader Dennis GartmanFor subscription information for the 5 page plus Daily Gartman Letter L.C. contact – Tel: 757 238 9346 Fax: 757 238 9546 or HERE to subscribe at his website.

THE US$ IS STRONG and the massively bearish psychology that has enveloped the dollar only a week or so ago has begun to change rather swiftly as very real technical damage has been wrought upon the EUR, to Sterling and to an increasing extent upon the Yen too, ahead of today’s second and final day of the FOMC meeting in Washington D.C.

We can get this discussion of the Fed’s actions… or more properly, not action… in one swift sentence: nothing shall be done; absolutely nothing. The Fed is content at this point to punt any potential changes to its policies to the newly constituted committee that shall take its seats after the turn of the year.

COMMODITY PRICES ARE VERY MODESTLY FIRMER, but they are so even  as the dollar is stronger and it is this divergence that has our attention here this morning.  For far too long the response by the commodity markets had been rather idiotically “knee jerk”: that is a weak dollar was supposed to give way to higher commodity prices and a strong dollar was supposed to give way to weaker prices. For months that was indeed the correlation, and for months one could trade each market against the other armed only with this thesis. Now that thesis is being put to test, and we think it is not a moment too soon. 

Regarding gold, we remain… and indeed are all the more… bullish of gold, but we are bullish of it in EUR and Sterling and Yen terms.


GOLD IN EUR TERMS:  €760 Has Been  Formidable Support: The  trend is upward, from the  lower left to the upper right, and owning gold in EUR terms has proven a far better  trade… and far less volatile…  than gold in US$ terms.


Mr. Gartman has been in the markets since August of 1974, upon finishing his graduate work from the North Carolina State University. He was an economist for Cotton, Inc. in the early 1970’s analyzing cotton supply/demand in the US textile industry. From there he went to NCNB in Charlotte, N. Carolina where he traded foreign exchange and money market instruments. In 1977, Mr. Gartman became the Chief Financial Futures Analyst for A.G. Becker & Company in Chicago, Illinois. Mr. Gartman was an independent member of the Chicago Board of Trade until 1985, trading in treasury bond, treasury note and GNMA futures contracts. In 1985, Mr. Gartman moved to Virginia to run the futures brokerage operation for the Virginia National Bank, and in 1987 Mr. Gartman began producing The Gartman Letter on a full time basis and continues to do so to this day.

Mr. Gartman has lectured on capital market creation to central banks and finance ministries around the world, and has taught classes for the Federal Reserve Bank’s School for Bank Examiners on derivatives since the early 1990’s. Mr. Gartman makes speeches on global economic and political concerns around the world.