The US Dollar -- the currency precious metals are priced in -- is standing at a crossroads today: The possibility of a breakout to the upside has grown in the past week, but the trend still remains down. So, what are the implications for the precious metals?

One road is a final plunge following the recent small rally. The other is a breakout to the upside from the severe downtrend it's been jammed in since early March. Should that take place, a rally could gain strength from panic short-covering. Sentiment (in terms of positions taken by commercial and non-commercial parties as measured in the Commitment of Traders report) for the dollar is universally bearish. Forex Options and Futures markets show US Dollar sentiment at near-record bearish extremes against almost all major counterparts.

I suppose that your email inbox is inundated with newsletters with headlines such as: "Dollar Forced to Abdicate," "End of US Dollar Global Reserve Currency," "Faces of Death: the US Dollar in Crisis,” to name just a few.

Could this one-sided positioning in the futures marker suggest that the USD is near a major turning point?

If you follow the fierce debate that's erupted in recent weeks between the two major camps in monetary circles, you get the sense that both sides are passionate in their beliefs. The gold bulls/dollar bears believe that gold is poised to take off while the dollar is perched for a collapse. The other camp -- the gold bears/dollar bulls -- claim just the opposite.

You don’t need the results of a sentiment poll mentioned on CNBC recently that nearly 98% of all respondents were bearish on the US dollar. Just listen to the people you know talk about the greenback. I doubt you'll find even one among your acquaintances who's bullish on the dollar. The public is worried that the only way to handle America’s massive debt is with stealth devaluation over a long period of time.

Is it possible that the policy markers in Washington will allow the mighty dollar to plunge to new depths? Sure it is -- if the only alternative is to admit that the previous monetary policy was wrong and that a crisis should have taken place many years ago along with higher unemployment in the past, and publicly state that US citizens now have to pay for all that with even higher unemployment and a lower standard of living.