The important U.S. Dollar Index is declining again this morning. The U.S. Dollar Index has declined since January 11, 2011 when the U.S. Dollar Index was trading around $81.31. Traders should understand that the U.S. Dollar Index is the measure of the value of the United States Dollar relative to a basket of six different foreign currencies. Therefore, when the U.S. Dollar Index declines it is really declining against the major currencies in the world. As we all know when the U.S. Dollar Index declines the stock market inflates higher and that is the case in the market today. Below are a list of the major currencies that are weighted against the U.S. Dollar Index.
Euro (EUR), 57.6% weight
Japanese Yen (JPY) 13.6% weight.
Pound Sterling (GBP), 11.9% weight
Canadian Dollar (CAD), 9.1% weight
Swedish Krona (SEK), 4.2% weight and
Swiss Franc (CHF) 3.6% weight.