This morning, stocks look to head higher as overnight, Europe reported that German Services and French Industry Unexpectedly Grew. This means the reflation trade is back on.
And sure enough, the dollar’s latest rally seems to be fizzling. The dollar says “good night” more times than a reluctant 3-year-old going to bed, so we’ll see how this works out.
Here is a chart of recent dollar action …
Now, let’s look at a longer-term chart …
And how is today’s dollar decline affecting gold. Let’s see …
This is options expiration Friday, so A) it could be volatile and B) we won’t know the closing direction of the market until the last half an hour. Be very careful. However, I am very glad for the two positions we added to Red-Hot Commodity ETFs yesterday. They both gapped higher today.
In other news …
Stiglitz Says Dollar’s Role as Store of Value Is ‘Questionable,’ Has Risk The dollar’s role as a good store of value is “questionable” and the currency has a high degree of risk, said Nobel Prize-winning economist Joseph Stiglitz.
Read Joe Baegent’s latest column.
Likewise, The Automatic Earth is particularly good today, putting its finger on the confusion and contradiction many of us feel about this market.
Related Posts
- Wednesday Charts: Is This Dollar Rally for Real? (08/26/09)
- Dollar and Gold are Soaring as World Flees Risk (02/17/09)
- Wednesday News Roundup — ‘Buy China,’ Falling Oil Prices, Dollar Doom, and More (06/17/09)
- What Could a Dollar Bounce Mean for Oil? (10/26/09)
- All Eyes on The U.S. Dollar (07/23/09)
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Nice history reminder in Stormy Seas. I kept wondering where is he going with this. I’m trying to educate my teenagers economically as we go through this mess. I’ll have them read Stormy Seas.
Thanks.