A longer term view gives you some perspective on the dollar. The downtrend in place since early this decade has been broken. The dollar has been quietly building a base for the last two years. A move toward better economic policy - particularly in regards to the deficit and debt - could cement the nascent uptrend.
- The Fibonacci retracements show where to expect resistance for the US dollar index which has broken the short term downtrend.
The Euro shows the opposite picture, tracing out a large top over the last two years.
Commodities have corrected with the rally in the dollar, but have held support at the 50 day MA...for now.
Is gold peaking? The IShares Gold ETF is still in an uptrend but if the dollar keeps rallying that might be tough to maintain. Gold moves on factors other than the dollar though as the rally last spring showed.
The uptrend in REITs is also in jeopardy thanks to the dollar rally. Real estate prices are highly correlated to the trend in the dollar.
If gold worries you, you might consider a switch to platinum. If gold falls because of an improvement in economic policies that should mean higher growth and greater demand for platinum.
The foreign bond ETF has broken its uptrend with the rally in the dollar. We were stopped out of half our position last week.
The 20+ year Treasury ETF has also made a long term top. Inflation on the horizon?
Chile is looking toppy but I'm not a seller yet. The economy is sound but market valuations look stretched.
I've been a long term holder of emerging markets but the short term uptrend is broken. Emerging market currencies are also looking very toppy.
Yes, I'm putting in here again. The Japanese market continues to surprise.
Taiwan looks better than most of the other Asian markets too.
If you believe in the Indian growth story, now is the time to step up and buy.