Arbeter: Searching for a Bottom

After breaking down last week, the S&P 500 index might find a floor near summer lows. But there's still no support for the dollar

It was another ugly week for the stock market, with the major indices breaking key support levels. All of the sudden, the market has woken up to the fact that the U.S. dollar is in a freefall, and the speed of the decline is starting to become worrisome. The medicine for a weak dollar is higher rates or higher GDP, neither of which look likely in the near- to intermediate-term. On the plus side, some sentiment indicators have reversed rather sharply to the bearish side, so we think all is not lost.

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