Can The Dollar Decline Enough To Save The Markets?

It is the dreaded Friday the 13th, can the U.S. Dollar Index decline enough to save the major stock market indexes again? Yesterday, as soon as the U.S. Dollar Index declined from it’s intra-day high the stock market indexes all posted gains into the close. I’m not complaining, however, this is getting ridiculous already when the only chart of any importance is the chart of the U.S. Dollar Index.

This morning the U.S. Dollar Index looks like a raging animal that is trying to break free from it’s cage. The debt problems in Europe seem to be increasing by the minute as the problems in Greece, Portugal, Ireland, and others remain. The saving grace for the markets today is that it is a Friday and rarely do we have a sharp decline on a Friday. You see, Friday’s are the end of the work week for most people. This is when people will usually spend money as the weekend begins. If people do not start to spend more money then the economy does not function and all of this quantitative easing by the Federal Reserve will have been a wasted experiment.

Consumer spending accounts for roughly 70.0 percent of the gross domestic product (GDP) in the United States. Therefore, it is very important that people start to spend more money. If you have not noticed, there have been very few Friday trading sessions when the Dow Jones Industrial Average closes down more than 100.00 points. Often the markets will trade flat to slightly positive. If someone goes back and looks at a chart there have been less than a dozen sharp sell offs on Friday’s in the past two and a half years. Therefore, we expect a flat to slightly positive trading session today.

About Nicholas Santiago 575 Articles


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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