I’d have to say this is the first time in my entire trading career where I’ve seen both the US Dollar and US equities rise together – for such an extended period of time. The USD has been up up up some 25 days and running now – while stocks continue to grind higher as well. Something is obviously up.
The USD as well as the JPY are (under most conditions) recognized as “safe haven” currencies (as absolutely bizarre as that sounds) and as risk presses on and stocks move higher – these are normally sold. When risk comes off – flows head back for the ol USD as it is still the world’s reserve currency.
So are the big boys already building positions in USD in preparation for a larger correction/world event/news flash?
Looking at the calendar – I had planned to be in 100% cash as of the middle of March with expectations of such an event, and here we are….. only two days away. Obviously I can’t say for sure – but it would make a lot more sense to me that stocks would correct here as opposed to the Dollar. After this many days moving higher – we’ve got to see a little “zig” in that “zag” at some point.
So….with several open positions (small positions thankfully) I will likely plan to watch closely over coming days and even throw on a couple stops (which I normally / rarely use) in order to keep my self insulated from any “global disaster”.
Short of that…..perhaps things keep chugging along a while longer , and indeed the USD does finally make a turn down – and stocks continue there “blow off top”.
Trade safe here people. Market direction IS uncertain.