Stock Market Update: Markets Fight A Stronger Dollar
The markets are trading on the flat line today which is a victory. The big question is, can it hold and build the day into a positive move. The reason for the victory today is simple. The Dollar is spiking higher on the session off of more bearish news out of Greece. This is hitting the Euro, thus spiking the Dollar. The PowerShares DB US Dollar Index Bullish (NYSE:UUP) is trading at $21.11, +0.08 (+0.38%) while the SPDR S&P 500 ETF (NYSE:SPY) are trading at $129.10, +.14 (+.11%).
With the markets trading neutral on a day when the Dollar is higher, a bullish bias must be taken for today and the rest of the week. This is a technical divergence that indicates a bounce is on the horizon in the markets. In addition, we all know options expiration is next week. With all the retail investors loading up on puts, it is very unlikely the institutions will allow the market to head lower, causing them to take big losses. More than likely the markets will get a bounce, drawing many of those puts to expire worthless.
Oil is the standout commodity of the day. OPEC's meeting over the last couple days ended in a stalemate. This has never happened before. Ultimately, oil output was expected to rise and will now stay the same. In addition, this disagreement inside OPEC must be looked at as another destabilizing aspect in the Middle East. The United States Oil Fund LP (NYSE:USO) is trading sharply higher at $40.14, +1.09 (+2.79%).