This morning, the U.S. Dollar Index futures (DX Z1) are soaring higher by 0.54 cents to $77.39 per contract. As we should all know by now, when the dollar goes up the major stock market indexes will go down. The markets deflate very quickly when the U.S. Dollar Index trades higher. The U.S. Dollar Index futures (DX Z1) will have some short term intra-day resistance around the $77.80 level.
Most leading commodity stocks such as Freeport McMoRan Copper & Gold Inc (NYSE:FCX), BHP Billiton Ltd (NYSE:BHP), and Rio Tinto plc (NYSE:RIO) are coming under some selling pressure as the U.S. Dollar Index trades higher. These same stocks will usually catch a bid once the U.S. Dollar Index pulls back. Many leading energy stocks will usually pullback or decline when the U.S. Dollar Index trades higher. Traders can easily see the early weakness in stocks such as Chesapeake Energy Corp (NYSE:CHK), Exxon Mobil Corp (NYSE:XOM), and ConocoPhillips (NYSE:COP) as the U.S. Dollar Index rallies.