The rally in the U.S. Dollar over the past few months has increased the number of Dollar bulls to a pretty lofty levels, as well as other Dollar indicators are reaching overbought levels too. 

Over the past few years when sentiment reached these levels the Dollar needed to decline for a while, to work off the excess bullishness. The Dollar may have created a short-term Head & Shoulders topping pattern that needs to be worked off at the same time!

Over the past few months the Dollar and S&P 500 have trended together/high correlation. If the U.S. Dollar would declines, will the high correlation between the Dollar and stocks continue?



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