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U.S. Dollar Index Surges



July 18, 2011 – Comments (0)

By now, most traders should know that when the U.S. Dollar Index surges higher the major stock market indexes will deflate and decline lower. That is exactly what is happening this morning, the major stock indexes are declining sharply lower as the U.S. Dollar Index rallies. Short term traders must watch for some short term intra-day resistance on the U.S. Dollar Index futures(DX U1) around the $76.08, and $76.34 levels.

Should the U.S. Dollar Index pullback at some point throughout the trading session this is when the major stock indexes are likely to catch a bid higher. As long as the U.S. Dollar Index continues to climb higher throughout the trading session it would be prudent to expect much lower stock prices. The inverse relationship between the U.S. Dollar Index and the major stock indexes remains firmly intact at this time.

Nicholas Santiago

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