We are watching the relationship between the S&P500 and the US Dollar get bent over backwards. Our first posting of this pending disaster was back on September 30 as the US Dollar was well into its breakout.
We then updated this on November 24 as we expected the S&P500 to tank based on the strength of the US Dollar.
And here we are today with markets at all time highs and the US Dollar readying itself to continue toward 99.00 and likely beyond shortly thereafter. US Dollar strength puts enormous downward pressure on US stock indexes - something the Fed cannot continue to prop up.
We've said to keep an eye on the US Dollar with respect to commodities and we can now see what happened to oil, natural gas and copper. Even gold and silver's expected move up has been muted as we had forecast - we could eventually see gold collapse again.
More recently, we have reported the importance of the strength in the US Dollar and its negative impact on US stock indexes. At some point soon, we expect US stock indexes to fall sharply - in the order of 200 points or more in a month for the S&P500. Other indexes will follow suit.