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US Dollar drop coinciding with lift in Metals, as Equity advance pauses

Minor weakness in global equities this am, with Europe lower by 0.60%, Most of Asia down, lead by Japan -1.6% and US Futures just fractionally lower-  -0.20%.   Big overnight development technically was the breakdown in Dollar/Yen  and Dollar vs Euro which looks important and negative for the US Dollar vs most of the developed and emerging currencies-  Gold is higher by about 0.80% while Crude has stretched up to resistance just over 46 which hits the 50% retracement of its decline from June-  NASDAQ had signaled some counter-trend sells yesterday on the close which could slow QQQ, NAZ COMP, XLK here, and technically I think its right to consider taking profits in some of the Tech stocks that are stretched here, GOOGL, FB, MSFT within the large caps- while SPX, DJIA shows no meaningful evidence yet that any type of trend reversal should occur.  Overall, given yesterday's breakout in industrials and Semis, we should be facing a much more selective market in the next couple weeks where NASDAQ should UNDERPERFORM after its recent run, but all eyes for today will be on the US Dollar breaking down which should be positive for Commodities and Commodity stocks.  first support for S&P at 2180, then 2175, 2165, while 2191 important on the upside- Gainers today: STEM, ALLT, DKS, MOMO, FN, PX, ATHM, while on downside- HAIN, HTBX, UNVR, ALRM, HPT, ONCE, EVOK-  let me know if you have questions

 

US Dollar index dropping to the lowest level since June today, breaking down vs Euro and yen, which should fuel commodities and Emerging mkts further-  The Metals complex seems to be showing some early strength, but has pared gains on Dudley comments regarding September being still "on the table" for possible rate hikes

 

Gold's technical pattern seems to be suggesting an upside breakout lay ahead, just at a time when most Hedge funds and speculators have begun to cut their bullish bets.  Total assets in ETF's backed by gold fell by almost 13 tons to 2,027 tons last Friday, the biggest drop this year and Bullish bets have been cut the last four of five weeks-  Technically it seems premature to abandon gold given the declining US Dollar , and this one-month consolidation likely could be broken to the upside which would be confirmed on a close back up above 1365.  Upside targets lie near 1485 which represent the 50% retracement of Gold's entire decline from 2011