It is certainly no secret that the US dollar has gained significant strength versus other fiat currencies as of late, and commodities certainly have fallen under pressure over it.
But that may be about to change..
Have a look at the chart below. This is ticker (NYSEARCA:UUP), a US dollar bullish ETF. Notice the parabolic move higher over the past few weeks.
Whenever you see any assets price action begin a parabolic move like this, it should be a warning sign that things may be about to change.
We also know that the Federal Reserve is no where near it’s inflation target of 2%, and the strengthening dollar is only making matters worse.
In my professional opinion central bank intervention will be taken soon to stop this dollar climb, and hence attempt to end the deflationary cycle we are currently in. (Keep in mind that the dollar strength is just one piece of the deflationary puzzle, money velocity being at a 55 year low is also another factor).