The U.S. Dollar is being crushed again after a brutal drop yesterday. The PowerShares DB US Dollar Index Bullish (NYSE:UUP) is down $0.22 to $23.50 (-0.91%). Based on history, we know when the dollar drops the markets usually rally. This is the case today, however, such a big drop in the dollar usually gives the markets a better push to the upside. This needs to be watched closely. The SPDR S&P 500 ETF (NYSE:SPY) is higher by just $0.50 to $113.22 (+0.44%).
There are some interesting factors in the market today that must be watched. While the markets are higher, as stated earlier, the dollar drop usually gives it a better push. In addition, gold is soaring today, hitting new all time highs. The SPDR Gold Trust (ETF) (NYSE:GLD) is higher by $2.68 to $124.30 (+2.20%). The strange thing about this is when the markets are higher and fear is subsiding as it has lately, gold usually drops. Gold is a fear index and investors run to it for safety. For gold to be soaring today and the markets are up, someone is intent on buying the precious metal regardless of how the markets look today.
Gareth Soloway
Chief Market Strategist
www.InTheMoneyStocks.com
