Today I am going to dispense with the normal format of discussing several commodities, because in fact, none of that info in the big picture matters more than the value of the US dollar and its effect on the pricing of any commodity. I am going to show you an amazing repetitive event that has been occurring literally every month for two years. The significance of two years, is the fact it was two years ago in May that the FED stated the end of QE 2, and other than small variations of it, another has not occurred and the existence of another one has been denied. This has been a strong reason as to why commodities have been so vicious and trends never last more than a couple of weeks. It seems, just as you figure something out, everything changes. The reality is, the US dollar has changed on you.

The observation is that the US dollar is changing trend at minimum, at the first of every month. The obvious repetitive nature of it almost has to be by design, rather than random events. So the FED must be having a hand in it because it would not be so repetitive like clockwork. Below I have placed two charts (the continuation daily chart of the US dollar), and marked a red arrow on the first trading day of the month. Now keep in mind the first trading day of the month is not necessarily the first of the month because of weekends. But what is amazing, is that if you use a 4 day window, (the day before the last day of the month, and the day after the first day of the month) you nail 22 of the last 24 turns at the beginning of each month.

Now what is also interesting is that you will notice in the last year almost all first of month turns are lows except for extended runs to the upside, like the current one, become a high. So basically the dollar has been hitting a low at the first of the month and then running up for two weeks, just to come back down for the month end. Causing all the commodities to viciously break from whatever they are doing every two weeks.

The current and important point I want to make is this: Based on two years' worth of history, and a 92% accuracy outcome, today through Monday June 4th, the US dollar should make a high that lasts at least for two weeks. This will allow commodities like energies and grains to mount a recovery rally and find interest in any bullish news that has been ignored. Whether this is a major trend change, I do not know. But when you consider that the European problems are so well known that anyone on the street is mostly aware of the turmoil, the stage is set for an emotional high that could be set for awhile. One thing I am fairly confident of, is by next Tuesday/Wednesday I think we will be looking back at this Friday and saying, "yep, they did it again, The US dollar changed its price trend."

Hopefully this will help in your trading.
 

Dollar Chart 2011-2012