Is it time to ditch the dollar?

of high volatility and uncertainty on the markets, politicians in the US are not the solution but the problem.
This has left the market confused forcing a big sell-off of all dollar denominated assets.
The question is it time to ditch the dollar as investors all over the world have pressed the panic button?

The global market is in dire need for direction as recession fears loom. Currently, volatility looks likely to surge as investors seek to exit money-losing trades before the end of the year.
With volatility muted, firms have had few opportunities to make directional bets that price swings will either increase or decrease the magnitude.
The increase in the volatility is giving traders opportunities to create new positions and unwind old ones.

The currency market is too volatile and that has forced investors to reduce their net long position in the euro, dollar and the pound.
The Swiss franc continued to strengthen to records against the dollar, pound and euro as the US downgrade to AA+ from triple-A stoked demand for the haven currency.
Investors increased their bets on the classical currency and remained bullish on the Swiss franc.

The dollar index fell following the US downgrade as it lost its triple-A rating as debt concerns mounted.
The euro got a boost from the ECB after the ECB announced it would buy bonds in the eurozone that may amount to US$1,2 trillion.
The downgrade to the US triple-A rating has left investors looking for safe havens.

The markets need direction at the moment and it looks like the politicians are not giving that.
The Swiss currency strengthened 0,5 percent to 0,7542 centimes per dollar in London after it reached a record 0,7631 centimes earlier.

It jumped 0,2 percent to 1,0809 per euro having reached a record 1,0800. It strengthened 0,2 percent against the pound to 1,2524, having set a record 1,2584.
The strength of the franc against the euro and the dollar will be felt on the market for a while.

Euro-Swiss is making new lows that tells you that the US may have arguably improved for the debt ceiling outlook but that there is still risk out there, including the peripheral euro-zone, the focus will come back on the euro zone.

At the moment we have a fair amount of money flowing into gold as the commodity continues its rally.
There are still a lot of people who would like to sell the euro and the dollar because of the global financial fiasco, so there is not a strong bias for the euro, there may be more investor interest in potentially selling the dollar against the franc and the yen.

In Europe the euro erased losses earlier against the dollar on ECB bond buying to save lenders.
The euro gained by 0,9 percent from US$1,4169 to US$1,4225 and a further weakening against the Swiss franc trading at 1,0810 per euro.

The euro reversed earlier gains against the pound trading at 0,8667 per euro. The yen has given investors confidence to buy against the dollar as safety heightens. The advance of the yen to such levels could push the Bank of Japan to inject more money into the economy.
Stronger yen threatens profits of exporters. The Bank of Japan needs to buy a significant amount of government bonds to provide ample liquidity.

In Africa, South Africa’s rand reversed earlier gains versus the dollar on US sentiments.
The South African currency weakened as much as 0,9 percent to 6,9890 per dollar, erasing an earlier strengthening.
It traded at 7,180 per dollar as investors cut bets on commodity currencies. The rand depreciated 0,9 percent to 10,1968 per euro as ECB intervention on its bond buying project, which pushed the rand to its lowest.

Other commodity currency like the Aussie dollar and the New Zealand dollar all declined against the dollar on sentiment sapping demand for high-yielding assets.
The Australian dollar declined to 1,0183 from 1,0381. It declined 1,5 percent to 86,63 yen, set for the biggest one-day gains.
Gold hit an all-time high as the US downgrading curbed demand for the metal as an investment haven.

It seems the market is liquidating their net long positions from currencies to equities to buy the bullion.
The bullion was trading US$1 750 an ounce from US$1 706 an ounce. Crude oil slide earlier on recession fears after the US lost its triple-A rating.
Crude oil was now trading at US$81,27 per barrel after giving up gains on recession fears meaning crude oil lost US$2,20 cents in trade.