The Tide is Rolling Out

This downtrend in the dollar has been underway for months. The dollar has been moving lower since the U.S. Dollar Index hit 100 early this year. It also topped out last month around 98 and has been unable to rally back to those previous highs. The tide is rolling out.

The stock market has also been giving us sell signals. For example, the Dow Jones Industrial Average broke below key moving averages last month and has not produced any meaningful rally. These are negative signals.

Since the 2008 collapse, we have seen this action in stocks and the dollar before. In those instances the Federal Reserve saved the day for the dollar and stocks with QE programs and other schemes that pumped newly printed dollars into the system. But this time is shaping up differently.

The Fed has not done anything of substance — at least not yet anyway. The rising selling pressure in the stock market is the result.

- James Turk via King World News