By Gareth Soloway on June 8th, 2010 12:01pm Eastern Time
The markets are holding on to gains as the SPDR S&P 500 ETF (NYSE:SPY) are trading positive on the day. The markets have recovered from some steep selling after the Euro started to rally sharply and the U.S. Dollar fell off a cliff.
The PowerShares DB US Dollar Index Bullish (NYSE:UUP) has dropped sharply in the last hour, falling to $25.69 -0.14 (-.54%). This is a big drop for a currency that has been on a one way track going higher. The CurrencyShares Euro Trust (NYSE:FXE) has ripped higher as well. These two currencies will go in the opposite direct. As the Euro has soared, the markets have followed.
It looks like the Euro may been in for a short term pop. It is oversold technically and has a lot of negative sentiment which may result in the opposite move. In this case, a move higher. Keep a close eye on the close today and see if it confirms tomorrow with a higher close. A few positive days on the Euro and shorts may get squeezed. This would mean a short term pop in the market as well.
Gareth Soloway
Chief Market Startegist
www.InTheMoneyStocks.com
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