The USD has gained in light of recent economic uncertainties following a more than 700pt decline in the Dow Jones futures. Probably the newsiest event of the week was the inversion of the 2-yr and 10-yr yield spread. Often times the inversion of the yield curve is a harbinger for an oncoming recession and casts doubt over the safety of foreign currencies vs the U.S. Dollar. On top of the bond yield inversion, we’ve also heard news of the ECB preparing to launch a “major” stimulus program at its next meeting in September. The news of such events is very bearish for the euro, which is being reflected in its recent 150 point decline over this past week.  We do expect the U.S. dollar to eventually struggle as it continues to grind towards its Aug 1st highs of 98.93 in the cash market. The strength of the USD has threatened US Manufacturing (presently at recession levels), but has kept the U.S. consumer in a good place despite trade war with China. Until then, the dollar continues to be the currency world’s favorite safe haven choice. 

800-669-5354312-373-5286Series 3 Licensed

John Caruso

Senior Market Strategist

Follow John on Twitter @JCarusoRJO. John began his career at Wilshire Quinn Capital, a Wealth Management Firm based out of Los Angeles, California. John made his move to the commodity industry at the end of 2005, and began his path at Lind Waldock, at the time the largest retail brokerage division worldwide. John did his undergraduate work at Robert Morris University in Pennsylvania from 1999-2003, where he was a 4 year varsity basketball letterman.  A self-professed “Macro Trader”, John uses a multi-factor fundamental and “quantamental” trading model in distinguishing market cycles based upon the accelerations or decelerations of growth and inflation metrics. His technical and quantitative approach is heavily reliant upon trend and market range analysis via a custom built standard deviation system in helping him make probability-based market decisions. John is an avid reader of all things pertaining to finance, and behavioral economics. Click here to sign-up for John Caruso's Trading Coach Insights. Daily information and insight on all futures marketsin ranging from metals to equities.

Read More