US Dollar Relinquishes its Tepid Gains as the Dow Rallies

Through much of Thursday’s Asian and European session, the dollar was working on a modest but steady advance against most of its major counterparts. However, seeing as how this appreciation wasn’t supplied by any fundamental strength on the dollar’s own account; a timely reversal in equities would yield the same for the world’s most liquid but maligned currency. Investor optimism started to recover in the middle of the European session and the advance was amplified when the US market brought another round of earnings releases with it. While the third quarter earnings season doesn’t carry the authority of characterizing the definitive turning point for the markets (the previous quarter bore that responsibility) nor are market participants as hungry for any and all positive signs; the accounting to this point has offered evidence that a steady recovery is in place. Among the more notable companies to have issued income, returns or profit better than the market expected were American Express, McDonalds and AT&T. And yet, despite the consistent rally for the session, the benchmark Dow Industrial Average has not cleared the range that has developed over the past week. This is the same predicament that the dollar is, just in reverse. Investor sentiment has not veered from its bullish path; but another period of exhaustion suggests the steady buildup in speculative interests is growing extended.