Down we go again $DXY pic.twitter.com/J4LsX1Ovfj
— Grant Hawkridge (@granthawkridge) February 10, 2021
Today’s Chart of the Day was shared on Twitter by Grant Hawkridge (@granthawkridge). Grant points out that the US Dollar Index has resumed its structural downtrend this week. In mid-January, we explained that a potential move higher in the Dollar would likely be a headwind for risk assets including Stocks, Commodities, and Cryptocurrencies. In the following weeks, the Dollar did in fact move higher, but risk assets were completely unaffected. Instead of feeling pressure from the Dollar’s bounce, we saw new highs across the board in Stocks, Commodities, and Cryptocurrencies. The Dollar’s recent move higher did nothing to slow the rally in risk assets. If anything, it just created more room for the Dollar to trend lower, which should only help risk-assets.