Just Follow The Reserve Currency Of The World
This morning, the major stock indexes are struggling to trade into positive territory. The major stock indexes sold off sharply lower yesterday and remain very weak at the open. Traders must keep a close eye on the U.S. Dollar Index. As the U.S. Dollar Index(DXY) declined from its overnight high the major stock indexes have inflated and recovered a lot of the overnight declines. Last night, around 3:50 am EST the U.S. Dollar Index traded as high as $77.17 per contract. Currently, the U.S. Dollar Index is trading around the $76.40 level, this is a sharp pullback in the U.S. Dollar Index. Remember the markets trade inverse to the dollar at this time.
By now, we should all know when the U.S. Dollar Index declines the major stock and commodity markets will generally inflate and trade higher. Stocks such as Freeport McMoRan Copper & Gold Inc.(NYSE:FCX), Southern Copper Corp.(NYSE:SCCO), and Cliffs Natural Resources Inc.(NYSE:CLF) have all traded into positive territory as the U.S. Dollar Index declined. Should the U.S. Dollar Index rally or trade higher throughout the day these leading commodity stocks should pullback.