Thursday, May 01, 2008

The U.S. dollar is "Cool" again....

From the look's of things this morning the U.S. Dollar may be rolling over and strength is on the way. I think all the pieces are starting to fall into place.

1. The Fed signaled yesterday that they are in the pause camp as far as interest rate cuts go.

2. The world is in a very inflationary environment. What would help this? Lower commidity prices led by crude. A 10% gain for the dollar would have a considerable impact as crude is priced in dollars. The world knows this and are starting to wake up. Venezuela even came out yesterday and stated that they were not going to go away from pricing their crude in dollars.

3. The worst of the Sub-prime mess seems to be behind us. I am not saying it is going to get better...just not worse.

I think you start building a long dollar position. I want to stay away from commidity currencies for now as yields there are to high.
Good Luck and Good Forex Trading



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