Chris Ciovacco submits: Last week, we mentioned stocks could surprise by year-end. Some hopeful signs supporting that thesis are being given in the commodity, currency, and stock markets. Specifically, recent moves in the U.S. dollar, crude oil, Australian dollar, S&P 500, emerging markets, and Sweden provide some additional evidence a double-dip recession is not as likely as some believe.
Despite monster deficits, the U.S. dollar has served, somewhat ironically, as a safe haven currency since the financial crisis began in late 2007, early 2008. While the U.S. dollar’s impact on the markets is often overstated, the pattern has been when investors are risk averse, they buy U.S. dollars; when they are more willing to embrace risk, they tend to sell U.S. dollars.
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