Should investors construct portfolios soley based upon what direction they think currencies will move?  Some times this works and some times you can get you head handed to you!



This chart was shared with Premium Members last week. It reflects that often times the Euro and the 500 index have a high degree of correlation.

 Yet if you went short stocks back in October, due to a Euro decline, you got your head handed to you. I wanted to share this chart today, due to the 500 is moving quickly higher above its April 2011 highs, despite the Dollar moving up of late.  The above chart is a reflection that decisions should be geared towards the patterns that each product has more so that correlation decisions.

How The Recent Decline In Stocks Looks "Eerily" Like Major Bear Markets Of The Past