Dollar/yen action is going to get much attention today, harmful for stocks - Analysts
“Somebody needs to reconfigure their computer models and recognize that
U.S. dollar strength is a headwind to this market,” says Michael
O’Rourke, chief market strategist, in a note to clients. There’s more on
that yen/S&P 500 action in his chart today.
Even if this isn't what stocks should be cheering, dollar/yen action is going to get much attention today, says O'Rourke.
“Consider the fact that U.S. dollar
strength was a key contributing factor in the FOMC’s decision not to
tighten today and (Monday’s) close was the strongest for the dollar
index in nearly two weeks,” he writes.
“Then consider the fact that the
Dollar index understates the strength of the Trade Weighted Dollar.”
Blogger Bart in his Barts' Charts said he’s awaiting another bout of yen strength. If the correlation with stocks remains in tact then equities are going to have a tough time, he says.
He expects the dollar will coast all the way down to ¥116.
