Dirty Dollar! Rocking Industrial Metals and Dow!!
A quick comment before getting to the post. Sometimes when I put a long post like the one coming up on Friday, it will be the only post for a week or so. It takes some time to put together. When I am traveling or getting ready to travel or busy, it might be more than a week. This will be one of those circumstances. It doesn't mean I am not interested in my blog. I would like to post every day if I had the time but sometimes I don't. Hopefully, the upcoming post will be worthwhile.
I've written on here a fair amount about the dollar. Recently the dollar has had a massive slide and sentiment remains unbelievably bearish. While the dollar will do what the dollar will do, I would expect the dollar will start to gain strength as everyone realizes global growth is waining. Today, the outward appearance is that global growth is great but America is weak. Hence, the dollar weakness. Or a reason for the smart money to sell off the dollar to get dollars bears frothing that the end of America is nigh. Of course, maybe they are right and the end is nigh. Comparatively the answer to that statement is no way. Not because I live here but because of fundamental reasons.
If economic weakness spreads, and it will, forex traders will realize that dirty dollar is a safe haven. And, how will that help the large caps that are rallying because a large portion of their profits are international? Uhhh.... Now, a quick comment. Does anyone see a correlation of activity on this chart of the dollar? Dropping dollar and rocking industrial metals and Dow? Yep. Dropping dollar is good for repatriated profits internationally as we saw in the first quarter. And a reason to shove metals. Dollar quits dropping and the markets quit going up. Hmm...coincidence? If you aren't capable of utilizing intermarket relationships to divine the future of investments, you are missing the entire understanding of financial markets. The quants and scientists developing investment mechanics for Goldman, Morgan, etc, aren't using MACD and stochastics to determine the direction of investments. They are building sophisticated intermarket trading systems amongst other strategies. Eventually their work will likely blow up but that's for another post.
I've written on here a fair amount about the dollar. Recently the dollar has had a massive slide and sentiment remains unbelievably bearish. While the dollar will do what the dollar will do, I would expect the dollar will start to gain strength as everyone realizes global growth is waining. Today, the outward appearance is that global growth is great but America is weak. Hence, the dollar weakness. Or a reason for the smart money to sell off the dollar to get dollars bears frothing that the end of America is nigh. Of course, maybe they are right and the end is nigh. Comparatively the answer to that statement is no way. Not because I live here but because of fundamental reasons.
If economic weakness spreads, and it will, forex traders will realize that dirty dollar is a safe haven. And, how will that help the large caps that are rallying because a large portion of their profits are international? Uhhh.... Now, a quick comment. Does anyone see a correlation of activity on this chart of the dollar? Dropping dollar and rocking industrial metals and Dow? Yep. Dropping dollar is good for repatriated profits internationally as we saw in the first quarter. And a reason to shove metals. Dollar quits dropping and the markets quit going up. Hmm...coincidence? If you aren't capable of utilizing intermarket relationships to divine the future of investments, you are missing the entire understanding of financial markets. The quants and scientists developing investment mechanics for Goldman, Morgan, etc, aren't using MACD and stochastics to determine the direction of investments. They are building sophisticated intermarket trading systems amongst other strategies. Eventually their work will likely blow up but that's for another post.
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