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The dollar train is leaving the station

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This looks like the move we have been expecting for weeks now. The dollar is rallying off a deeply oversold situation. Not a great time to be short DXY. In fact, the dollar index is bouncing 1% this morning, repairing the damage of the last week as it rockets back up to levels not seen since late April. Is this a complete turnaround? Doubtful. There is still too much concern out there that the DXY ( quote ) is headed down in the long term as it resumes its pre-crisis trajectory . But in there here and now, the technicals are finally back in the dollar's favor and this long-delayed train is in fact leaving the station. We see this in the recent silver move. Remember, the first part of the SLV ( quote ) retreat was done without any participation from the dollar -- a weakening USD should have actually supported silver prices. The fact that the situation moved in the other direction is incredibly dollar-positive. Not good for UDN ( quote ), especially if things start looking squeezed. And in the short term, a stronger dollar puts pressure on commodities and commodity producers. SLV is only the shining tip of the iceberg here.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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