FALLING DOLLAR BOOSTS COMMODITIES -- PRECIOUS METALS REBOUND -- COPPER CONTINUES TO GAIN -- COMMODITY INDEX CLEARS 200-DAY AVERAGE

DOLLAR INDEX HITS ANOTHER LOW... The greenback continues its decline to the lowest level in nearly two years.   Chart 1 shows the Invesco US Dollar Bullish Fund (UUP) falling to another multi-year low today.   And it's falling against all of its major trading partners.   As is normally the case, a falling dollar is boosting most commodity markets.   That includes energy and metals as well as agricultural commodities that have also been rising lately.  That may help explain today's gains in precious and industrial metals.

METALS ARE GAINING...Chart 2 shows the Gold SPDR (GLD) bouncing off its 20-day average in an attempt to fill last week's big downside gap. Chart 3 shows Silver iShares (SLV) also bouncing off their 20-day average. While Chart 4 shows the United States Copper Fund (CPER) nearing a new high for the year.

COMMODITY INDEX CLEARS 200-DAY LINE...The uptrend in commodities is attracting investor interest as shown by money flows into that asset class.   Recent gains in agricultural and soft commodities have also helped to broaden out the commodity advance.    Chart 5 shows the Invesco Commodity Index (DBC) moving above its 200-day moving average for the first time since January.  Stocks tied to commodities are attracting new funds as well.   Some investors are buying commodities as a hedge against the possibility of rising inflation which is often a side-effect of a falling currency.   A weaker greenback also helps large multinational stocks that do a lot of export business.