ABG

Dollar Bulls and Bears Struggle for Dominance

I should note that they sold $9 billion worth of euros to perform the dollar pump which started on July 15, 2008, but ran out of them last week. Now, they've bought more, but they've got precious few euros left, so they won't be able to do this much longer. Beyond that, the euros are quickly exhausted when you use them up to buy derivatives. Unlike China, the USA does not hold enough foreign currency reserves to really affect the currency markets without the use of leveraged derivatives.

Dollar Bulls and Bears Struggle for Dominance

Sorry, but there are no real dollar bulls, except for simple people who don't know much about the market for currencies. Everyone who understands the currency market is a bear on the dollar. The only bull is the United States ESF (exchange stabilization fund) which sold another $900 million in euros, and is now using them to buy dollar denominated derivatives to keep part of the existing dollar supply from rising. That is the only reason the dollar is showing strength. As soon as they run out of the money, they won't be able to pay interest anymore on a trillion or so worth of dollars, and the dollar will collapse.