Summary
Phil Anderson argues that stock market volatility driven by Trump/tariff headlines is a distraction from more significant macro moves, particularly the U.S. Dollar Index breaking below key support at 100. The email identifies silver and rare earths as emerging opportunities in the second half of the real estate cycle, and updates the US and AUS watchlists accordingly.
Key Claims
- The S&P 500 is noisy and headline-driven; the more important moves are in DXY and commodities — confidence: high
- The U.S. Dollar Index (DXY) has broken below major support at 100, a level held since 2023 — confidence: high
- After a major support break, a retest of that level as resistance is common; Gann’s “two days up” pattern is the trigger to get short — confidence: high
- Dollar weakness is a structural tailwind for precious metals — confidence: high
- Silver is historically cheap relative to gold based on the gold-to-silver ratio, and has not yet broken its prior all-time high (~$50), whereas gold broke to record highs at end of 2023 — confidence: high
- The second half of the real estate cycle should continue to support precious metals — confidence: high
- Rare earths are getting a boost from U.S./China trade war tensions — confidence: medium
- Lynas Rare Earths (LYC) has emerged from a basing pattern with Mexican Pete characteristics on the weekly chart — confidence: medium
- EOG Resources (EOG) and Advanced Energy Industries (AEIS) are no longer making higher lows and are removed from the watchlist — confidence: high
Mex Pete References
- LYC (Lynas Rare Earths): Described as having “Mexican Pete characteristics” on the weekly chart after emerging from a basing pattern. Anderson notes the breakout is not at all-time highs but frames it as a potential continuation breakout within a five-year uptrend. Watch level: “two days down” on a back test of $8 as support.
- General principle stated: Mexican Pete patterns remove guessing — if a stock stops making higher lows on pullbacks, the setup is invalidated and attention moves elsewhere. Applied to EOG and AEIS removals.
Stock Picks / Signals
| Ticker | Action | Notes |
|---|---|---|
| UDN (Invesco DB US Dollar Bearish Fund) | Add to US Watchlist / Watch to enter short | Inverse dollar ETF; wait for retest of 100 as resistance + “two days up” Gann pattern to trigger entry |
| SLV (iShares Silver Trust) | Add to US Watchlist | Watch for break above 50 |
| RRC (Range Resources) | Hold | Stop loss remains at $32.75; no close below stop yet; sector still of interest |
| GMD | Hold | Existing position in Mexican Pete Model Portfolio; riding gold rally |
| EVN | Hold | Existing position in Mexican Pete Model Portfolio; riding gold rally |
| EOG (EOG Resources) | Remove from US Watchlist | No longer making higher lows |
| AEIS (Advanced Energy Industries) | Remove from US Watchlist | No longer making higher lows |
| LYC (Lynas Rare Earths) | Add to AUS Watchlist | Watch for “two days down” on back test of $8 as support |
Predictions / Forecasts
- DXY will retest the 100 level as resistance following the support break — framed as probable/common behaviour, not a certainty
- Silver price: break above 50
- Precious metals broadly expected to continue higher through the second half of the real estate cycle
- Further U.S. dollar weakness anticipated
Notable Quotes
“It’s all a big distraction as the second half of the real estate cycle approaches its peak.”
“Here’s one of the benefits of trading Mexican Pete patterns. Never guess. If the pattern doesn’t work out, you move on.”