WELL, all those conviced oil was hitting 73, and the world was coming to an end I bet were sure surprised by this move in OIL & COPPER on a Friday no less, when equities were flat. Notice the dollar Index 85ish, not 88ish. Same fears exist, but new interpretation being established -- will see how much traction the trade gets. But the Inflation trade may be back on: Short the dollar, go long commodities. Why? Europe instituting austerity measures, US spending like there is no tomorrow. This comparison will be highlighted at G-20. Sunday, we could gap up, move over 80 on a breakout, and hit 83.50 next week---will see, but I imagine there are a bunch of shorts covering at 80, and then the buyers will be technically buying a breakout. But the longer term implications of the inflation trade are what is interesting, (copper 3.08--hasn`t been there in a while). Gold is a crowded trade, but copper and oil - much cheaper by comparison, could get some extended play if fund flows start going into these 2 commodities. Pay attention to the dollar index, if we make our way back to 81, crude will be over 90. Its not all about the Euro, its the dollar index that is the key, but I think the Euro benefits as well from this trade, and it goes farther than the experts think, back up to the 128-132 range. It took a couple of days for the big players to interpret the Fed statement`s implications: but just maybe, the interpretation is that we need to put back on our old favorite trade: Short the US Dollar, and go long commodities like Oil & Copper. The inflation trade has been put on on several occasions during the last 5 years, and fund managers have made a lot of money by initiating this trade. If it goes back on, this is just the beginning, as this trade is not crowded currently, but fund managers are sheep, they exhibit a whole lot of group think, they attend the same conferences, discuss the same un-original ideas, and then pile into the same trades. That`s one of the reasons trend trading can work so beautifully once the right instrument has been identified. So watch for this trend over the next couple of months to see if it in fact exists, and then trade accordingly.