But the dollar hasn’t done much of anything for the past six weeks. That lack of activity made the carnival barkers restless. And restless carnival barkers can shake up the currency markets on a lazy summer day.<\/p>\n
Just before the financial markets opened for trading yesterday, we started hearing rumors about a possible 4.5% GDP number. Those rumors drove down the prices of Treasury bonds, popped up the long-term interest rates, caused the dollar to rally, and pushed down the price of gold.<\/p>\n
Two hours later, we got another rumor. This time it was a 4.8% number. And the morning’s script played out all over again – bond prices lower, interest rates higher, dollar higher, and gold lower.<\/p>\n
Finally, just as it looked like the market had come to terms with the possibility of a 4.8% GDP, President Trump delivered a speech in which he commented that some folks were talking about a number as high as 5.3%.<\/p>\n
That caused a stampede into the buck.<\/p>\n
At this point, it’s fair to say the currency market is expecting a BIG number. The “whisper” number – not the official estimate, but the number most people seem to be looking for – is around 4.8%. So, it’s going to take a number even larger than that to coax more traders to buy the dollar. It’s going to be tough to get over that bar.<\/p>\n
And if we get a GDP number less than 4.8%, then the dollar looks vulnerable to a swift “sell on the news” reaction.<\/p>\n
I’ve been looking for a reversal in the dollar for over a month now. So far… nothing has happened. The buck hasn’t pressed higher, but it hasn’t reversed lower, either.<\/p>\n
After all the carnival games in the currency markets yesterday, it sure feels like the dollar bulls have been set up for disappointment.<\/p>\n
Today may be the day the dollar finally reverses.<\/p>\n
Best regards and good trading,<\/p>\n
![](\"https:\/\/casey-assets.s3.amazonaws.com\/images\/misc\/jeff-clark-signature.png\")
<\/p>\n
Jeff Clark<\/p>\n