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Wednesday, September 16, 2009

It's the Dollar, Stupid

by Brinkley

Weakness in the U.S. Dollar has continued to support a broad-based rally in equities, and from the looks of the chart, that trend may be in force awhile longer. The recent breakout in gold further reinforces this view, with an inverse relationship between the two well-established. An oversold technical bounce in the dollar along with some consolidation in precious metals and equities near-term would be standard, but at this point it appears that any such counter-trend moves may prove to be relatively short-lived for now.

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