U.S. Dollar Index Rally Drops Commodities

The rally in the U.S. Dollar Index (DXY) has helped to drop commodities sharply lower this morning. Since June 7, 2010 the U.S. Dollar Index (DXY) has declined lower by nearly 15.0 percent and this has helped most commodities soar to new highs. Traders should watch for intra-day pullbacks in the dollar to see when the commodities and commodity stocks could see an intra-day bounce. At this time gold, silver, and copper are all under pressure this morning.

Last night, the highly followed Shanghai Index(China) rallied sharply higher. The Shanghai Index finished higher by 1.35 percent. Usually, when the Shanghai Index has rallied so sharply in the past copper will generally trade higher regardless of move in the U.S. Dollar Index. Today, that relationship is not occurring as copper is declining. Many traders and investors will follow copper very closely as a sign economic expansion. Some leading copper stocks that are trading lower this morning are Freeport McMoRan Copper & Gold Inc. (NYSE:FCX), and Southern Copper Corp. (NYSE:SCCO). Traders can get a good gauge of copper by following the iPath DJ-UBS Copper TR Sub-Idx ETN (NYSE:JJC).

About Nicholas Santiago 575 Articles

Affiliation: InTheMoneyStocks.com

Nicholas Santiago started trading in 1991. In 1997, he became a licensed Series 7 and 63 registered representative. He managed money for a large, affluent private client group. After applying his knowledge to his client base, he decided it was time to begin teaching those interested in learning his methods. He is an expert in Technical Analysis. He has become an accomplished technician in the studies of Elliot Wave, Gann Theory, Dow Theory and Cycle Theory. In 2007, he partnered with Gareth Soloway to form InTheMoneyStocks.Com and realize his dream of educating others about the truth of the markets.

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