Nearly every trading session when the U.S. Dollar Index futures (DX-M2) are stronger before the opening bell at the New York Stock Exchange (NYSE) they will sell off after the open. Yesterday, and today are perfect examples of this phenomenon. Obviously, we should all know by now that a weaker dollar will ultimately help to inflate the stock markets higher. The extremely light trading volume is usually bullish for the stock markets as there are simply no sellers in the marketplace. When you combine light volume with a falling U.S. Dollar it will usually create a perfect elixir for higher stock prices.
Precious metals are usually the first equities to react positive to a falling U.S. Dollar Index. This morning, the SPDR Gold Trust (ETF) (NYSEARCA:GLD), iShares Silver Trust (ETF)(NYSEARCA:SLV), and the iShares Gold Trust(ETF) (NYSEARCA:IAU) have all turned positive as the U.S. Dollar declines. The energy, and commodity sectors will usually catch a bid as well if the greenback declines. The United States Gasoline Fund (NYSEARCA:UGA), and the United States Oil Fund (NYSEARCA:USO) have also turned positive on the dollar sell off.