The U.S. Dollar Index Soars As Fear Takes Over
This morning, the U.S. Dollar Index futures (DX U1) are soaring higher by 0.53 cents to $74.29 per contract. As we all know by now, when the U.S. Dollar Index trades higher the major stock indexes will usually come under selling pressure. Selling pressure might be an understatement, the Dow Jones Industrial Average is trading lower by more than 320.00 points to start the day. The next important intra-day resistance area for the U.S. Dollar Index futures will be around the $74.50, and $74.67, and $75.00 areas.
Traders must always watch for weakness in the commodity and energy sectors whenever the U.S. Dollar Index surges higher. Leading stocks such as ConocoPhillips(NYSE:COP), Alpha Natural Resources Inc.(NYSE:ANR), and Southern Copper Corp.(NYSE:SCCO) are all coming under heavy selling pressure on the back of the stronger U.S. Dollar Index. Should the U.S. Dollar Index pullback throughout the trading session these stocks could bounce off the early morning lows. Traders must follow the U.S. Dollar Index very closely throughout the rest of the day. The major stock indexes are still trading inverse to the U.S. Dollar Index.