As a result of the Dubai news yesterday, today the March Dollar Index is up 94.5 ticks from Wednesday’s close at 75.605 as I write.  The included chart shows that during electronic trade yesterday, the dollar rallied sharply on the news the Dubai wants to delay payments on more than $60 billion owed to 70 international banks over the next six months.  So markets are nervous in the low volume holiday trade both here and in the Middle East where they are celebrating some religious holidays.

So, what does the chart say?  So far, the chart shows that the overall trend of the dollar is still down.  This overnight price spike in the dollar is already selling off. No significant previous highs were taken out.   I recommend standing aside in the dollar index until the smoke clears.  Light volume days are great for taking profits on crazy market swings but may not be good days to enter anything new.  We have no idea on how this Dubai news will evolve or if the $60 billion figure is accurate either.

 David Hall

 The information and opinions contained herein comes from sources believed to be reliable, but are not guaranteed as to accuracy or completeness. The risk of loss in trading futures and/or options can be substantial. Each investor must consider whether this is a suitable investment. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results.

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