Clif Droke | Mar 19, 2015 02:11AM ET
Until the latest pullback on Wednesday, the U.S. dollar index had been on a rip-and-tear for most of this year. Earlier this week the dollar hit a new multi-year high as concerns over Europe and China have fueled foreign interest in U.S. assets. The greenback’s relentless strength is also a cause for concern among investors who fear that a stronger dollar will erode corporate profits this year. Since much of the bull market of the last few years was based on the bull market in corporate profits, this point is being taken seriously by Wall Street pros. It’s also worth examining in this our latest installment.
Also of concern to investors is the weak oil sector. The WTI crude oil price (basis May futures) fell to a nominal 5-year low of $44.84/barrel earlier this week after testing the January bottom. A decisive break below this level would likely catalyze another selling event in crude oil as protective stops are taken out, but if the crude price can stabilize above this pivotal low the market will get a needed reprieve.
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