NOTE: This is an exclusive article I wrote for Seeking Alpha, a financial website. The rest of the article, which I feel is one of my best articles, can be found at the link below.
When commentators on CNBC and elsewhere talk about the U.S. dollar being weak or strong, they reference the U.S. Dollar Index being up or down as their source. But most people I have found don’t really understand what the U.S. Dollar Index represents. In reality it is simply a camouflage meant to conceal the real weakness of the U.S. dollar.
This article will explain the U.S. Dollar Index and then make conclusions on how it is not a true indicator of U.S. dollar strength or weakness, and show how the price of gold is.
The U.S. Dollar Index
Ask your neighbor, friend or relative what the U.S. Dollar Index means or what it consists of and you’ll get a blank stare. In fact, ask your financial advisor what it means and I’ll bet they’ll answer you, but it won’t be the appropriate answer.
Even CNBC keeps the U.S. Dollar Index figures hidden from public view as they don’t include it as part of their scrolling data that one sees at the top of their daily broadcasts. CNBC does have the exchange ratios of the euro, yen and pound, but they don’t allow viewers to keep tabs on the U.S. Dollar Index itself.
Continue reading at the link below:
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About Doug EberhardtDoug Eberhardt is a 28 year financial services veteran and precious metals broker selling gold and silver at 1% over wholesale cost. Doug has written a book to help investors understand how gold and silver fit into a diversified portfolio, how to buy gold and silver, and what metals to buy. The book; “Buy Gold and Silver Safely” is available by clicking here Contact phone number for Buy Gold and Silver Safely is 888-604-6534
Disclosure:
Commodity Futures Trading Commission Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don’t trade with capital you can’t afford to lose. This is neither a solicitation nor an offer to Purchase/Sell futures or options. No representation is being made that any account will or is likely to achieve gains or losses similar to those discussed in this outlook. The past track record of any trading system or methodology is not necessarily indicative of future results.
All trades, patterns, charts, systems, etc. discussed in this outlook and the product materials are for illustrative purposes only and not to be construed as specific advisory recommendations. All ideas and material presented are entirely those of the author.