Gold price breakout on a 'mini' crisis 2009 (update 2) - the 'mini crisis' could be near term USD dollar collpase

And the mini crisis could be near term US dollar collapse, rumours are circulating of countries already discussing (a future plan) dumping the USD as the trade currency or global base currency, particularly with oil trading. To be replaced by a stable basket of currencies, the rumour is probably more a way of making the US government and Federal reserve aware that US dollar weakness is unacceptable in international trade as USD purchase power diminishes.

So, the only thing/s that can save the USD as discussed on this blog are: A war, another credit crisis (commercial) or a 'trade' war. In the meantime as discussed in The selling of the US dollar - a USD currency crisis within the next 3mths., if the USD collapses through it's supports of 0.71; then government/central bank intervention will occur. But the commercial property crisis may cause a reprieve for any FX intervention as stock markets correct the USD may find a delay (brief) in it's decline. It would be wise to watch for stock market corrections toward the end of 2009 and bank credit losses in 2009 and 2010.

In the meantime the USD weakness is driving up gold (as an inflation hedge) and gold stocks, commodity currencies also have risen significantly more so the Australian Dollar as noted in The Australian dollar may reach parity against the US dollar in 2010.

But gold is the winner in the current climate of USD weakness

Currently overbought from it's trading ranges of 1000 and 1018; there has been reaction buying from USD dollar rumours. Any other rumour of central bank intervention will drive the US dollar higer, must be watched for any goverment/central bank reaction.

*morbius glass doesn't give investment advice, trade at your own risk