Speculation is, at last, starting to rise that the HK$/US$ peg could break. The all-powerful governments are suddenly being seen as no so powerful. The massive dollar rally that our model has been forecasting is rather straight-forward. The higher the US$ rises, the more deflation will be exported to economies that are out of sync with the USA.

The dollar haters only talk about the $18 to $19 trillion debt and that is the sole reason, they assume, why commodities must rise and the dollar has to crumble. What they fail to see that it just so happens to be the WORLD. The sea of debt out there has exceeded $200 trillion. When you look at the U.S. government, I hate to say it, but it is a drop in the bucket.

Then we have China in a contractionary decline, Europe being torn apart thanks to the refugee crisis that will only get far worse, and emerging markets who assumed China would buy every commodity in sight forever. There is little hope of anything rising right now to offer any sort of an alternative to the US$ federal debt. Believe it or not, there is a SHORTAGE of federal debt when the entire world has only one place to park BIG MONEY.

Consequently, we will see virtually EVERY currency pegged to the dollar break from Hong Kong to the Middle East. Welcome to BIG BANG.

Right now, the fear has been that Iran will start dumping oil now that the sanctions have been lifted. Thus, crude has been falling out of bed in a nightmare scenario. The fact that Crude was below $35 and then rallied to close above it for the 2015 year-end closing was a warning that the long-term may not be as bearish as it appears at first glance. Crude still elected a year-end sell signal at $41. So that meant lower lows. But our other two numbers were $35 and $25. Breaking $30 certainly focuses our attention on the $25 level as support on a system basis. Technically, the $25 area is also showing up as support during January.

Cyclically, this collapse in price has been on target since our timing projections have been January, March, and June here in early 2016. We have warned that 2016 was the target for at least the intraday low.

When we start to look at what the computer is projecting in time, indeed 2016 is a Directional Change. It appears choppy until about 2018. From there out into 2022 to 2023/2024, which will be the next top in the Economic Confidence Model, we see a sharp rise in volatility. This is lining up with two primary factors – WAR and a MONETARY CRISIS.

So for now, we should focus on the $24-$25 area as the next psychological support zone. Our two key areas of target support for 2016 are $25 and $16. Looking forward, we employed our WHAT IF models to try to forecast where the Yearly Bullish Reversal (buy signal) will be generated from a low at either position in 2016. Interesting enough, in both scenarios, we end up with $40-$41.50. This will clearly become the major resistance moving forward. It does not appear that crude will ever make new intraday highs. It must fight again