I am, however, detecting early signs that this inverse relationship may be breaking down....so beware of relying on this as a “black box” type of thing. It has worked remarkably, insanely well for 2 years. By the way, there is little or no secret about it, either.
I’m not saying that the relationship will vanish; I am saying it may not be *by far* the most significant driver of stock prices which it has been. I suspect a weakening dollar, when it happens in compressed time periods will be decidedly bullish for equities for the foreseeable future, under almost any circumstances.
No, it’s certainly not a secret for those of us that study the market. But it is what it is. The charts show it. As to whether that inverse relationship has started to break down, who knows? Time will tell. All these kind of relationships seem to eventually break down.
The same inverse relationship exists between the dollar and precious metals, so in effect, the decline in the dollar is driving up the cost of PM’s, though the run to PM’s as a safe haven has exacerbated that rise in the US$ price of PM’s.