The value of the dollar has been making headlines and receiving a lot of buzz online. Some people love the value dropping…predominantly investors. Historically, fund managers push money into appreciating assets and away from depreciating cash hoards (though…we are seeing cash hoards increase as well while the dollar depreciates; a double whammy).
The dollar value is a formula, and not traded itself. Sidenote: If you are trying to evaluate the dollar for your investments or trades, it is better to track the Euro than DXY, because the Euro is actually traded. The Euro also has the largest impact on the value of the dollar at 57.6%1. Countries with a negative coefficient will cost “more” than countries with a negative coefficient. This is just a general rule of thumb and I am sure there are a few exceptions, with many more variables.
The primary point of the post, since most of you are investors….is we want the dollar to continue trending down. This is one of many factors that will help maintain our bullish momentum in the markets. Will it last forever? Absolutely not! Again, this is a matter of perspective…consumers will want the opposite, justifiably.
One last note; instead of mid-week movers tomorrow…which I am getting uncomfortable picking up new positions at the moment…I want to get the short screener results out. I am not sure how they will perform, but its good to get a batch out, monitor and review results, publicly. We will find out if we have a working product…or if we need to go back to the drawing board. Regardless, I will keep you updated.
Never let a profit turn to a bag, protect your entries, and relax. No point in fretting about any of the variables out there. You can’t control them. Thanks for stopping by!
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