October 22, 2013 at 12:56 PM EDT
A Weaker Dollar Will Continue To Boost This ETF
NYSEARCA:UUP, NYSEARCA:EEM Related posts: Stocks Win With a Weaker Yen Is The Economy Getting Weaker? S&P 500 Could Hit 1,700, But Weaker Stock Cycle Ahead Indonesia ETFs Get A Boost On Surprise Rate Hike S&P 500 Index: Markets Pop On Weak Dollar Events

dollar etfDouglas Davenport: Global trade has an enormous influence on the financial markets and worldwide economy. So when the currency that serves as the guidepost for valuing assets drops 1 percent, all investors are affected. That’s exactly what happened to the U.S. dollar last Thursday.

The PowerShares DB US Dollar Index Bullish Fund (NYSEARCA:UUP), which compares the greenback against a basket of major currencies, posted the fourth-biggest decline in a year after the announcement of the debt deal in Washington. International investors soured on America’s ability to pay its bills.

UUP also was turned back at a logical point of resistance (please see below the red line in the chart), which provided further support for investors hoping for a weak dollar.


Click for larger version

The Federal Reserve watches the impact of the dollar’s value on emerging economies. An economic warning from China not only increased the odds of additional Chinese stimulus, but it also raised the odds that the central bank will push off tapering its massive $85-billion-a-month bond-buying program.

Stock investors seem to think so. From Reuters:

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Related posts:

  1. Stocks Win With a Weaker Yen
  2. Is The Economy Getting Weaker?
  3. S&P 500 Could Hit 1,700, But Weaker Stock Cycle Ahead
  4. Indonesia ETFs Get A Boost On Surprise Rate Hike
  5. S&P 500 Index: Markets Pop On Weak Dollar Events

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