GLOBAL STOCKS AND COMMODITIES FALL TOGETHER AS DOLLAR RISES -- OIL LEADS COMMODITY DECLINE

John Murphy
by John Murphy,
Chief Technical Analyst, StockCharts.com

RISING DOLLAR HURTS STOCKS AND COMMODITIES... A surge in the U.S. Dollar is contributing to heavy selling of global stocks and commodities. Chart 1 shows the DB Bullish Dollar ETF (UUP) gapping more than 1% higher today and nearing a test of its mid-June peak. Chart 2 shows the Commodities Tracking Index (DBC) tumbling 3% and threatening its spring lows. [Oil is the biggest commodity loser as are energy stocks]. Stocks are falling along with commodities. Chart 3 shows the S&P 500 falling nearly 2% and once again threatening its (red) 200-day average. Bonds are the only winners today (along with oil-sensitive airlines). Falling bond yields imply economic weakness which is good for bond prices but bad for stocks and commodities.

(click to view a live version of this chart)
Chart 1

(click to view a live version of this chart)
Chart 2

(click to view a live version of this chart)
Chart 3

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John Murphy
About The Author:

John is a renowned author in the investment field and former technical analyst for CNBC. Considered the father of intermarket technical analysis, his books include “Technical Analysis of the Financial Markets” and “Trading with Intermarket Analysis”. Learn More 

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