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Breakdown in Appetite for US Based Assets

|Includes: DRR, CurrencyShares Euro Trust ETF (FXE), UUP

Today S&P downgraded the sovereign credit outlook of the UK. There are murmurs that the US will be next. This is putting a lot of pressure on all USD denominated assets. The USD is falling, longer term treasuries are crashing. Unlike in the past where a falling dollar would help equities, the US stock market is under selling pressure and testing key support levels.

I have added a short Euro position, since I believe that the Europe will follow whatever the US has to endure; they will be just a day late and a penny short. This is a risky position with tight stops, but the trend is likely to take a pause before the long weekend.