Harry Truman liked to say “the buck stops here.” But at Fast Money we’re more interested in where the buck stops next.
On Thursday the greenback hit one-year highs against a basket of major currencies including the euro. Pundits speculate that the recent bailout of Fannie and Freddie is giving investors around the world renewed confidence in America’s currency.
In turn, a stronger dollar suggests a pessimistic outlook for commodities. And analysts say the slump in oil and metals prices over the last six weeks may intensify.
For further insights we turn to one of the most respected commodities traders working today, strategic investor Dennis Gartman, author of the Gartman Letter.
“It’s a bull market for the dollar and it has been for some time but it’s important to remember you can be 1) really, really bullish, 2) bullish or 3) neutral,” explains Gartman.
”Traders have moved the dollar from 160 versus the euro down to 139. That’s probably too far in the short run. If there’s any reasonable correction, if the dollar goes back to 142 versus the euro, then you can buy dollar. But right now I’d sit on the sidelines,” Gartman counsels.
Before the show Gartman told our producers that to trade the trend he'd recommend getting long PowerShares DB Dollar Index with an entry point of $24.10.
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Trader disclosure: On Sept 11, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Macke Owns (WMT), (UUP), (MSFT); Adami Owns (AGU), (BTU), (C), (GS), (INTC), (MSFT), (NUE); Najarian Owns (AAPL) And (AAPL) Collar; Najarian Owns (AKS) Call Spread; Najarian Owns (MER) Put Spread; Najarian Owns (MS) And Is Short (MS) Calls; Najarian Owns (XLF) And (XLF) Collar; Terranova Owns (AAPL), (EOG), (FCX), (GS), (NOV), (KOL), (POT), (RIMM), (SA), (X), (VLO), (YHOO); Terranova Owns (AIG) Puts And Owns (AIG); Terranova Is Short December 2008 Dollar Index Futures
Terranova Is Chief Alternatives Strategist Of Phoenix Investment Partners, Ltd.; Phoenix Investment Partners Owns More Than 1% Of (ABD), (ARE), (BIG), (BRE), (CNTY), (CNW), (CLB), (OFC), (DLM), (DRH), (DLR), (EPR), (ESS), (EXR), (AGM), (FL), (GBL), (GNET), (IGE), (LNET), (MAC), (OIIM), (PSPT), (DBC), (DBV), (SLB), (GWX), (SSYS), (SKT), (UA), (BIV), (VV), (BLV); Phoenix Investment Partners Owns More Than 1% Of Goldman Sachs Financial Square Fund - Money Market Fund; Phoenix Investment Partners Owns More Than 1% Of Seagate Technology Tax Refund Rights
Terranova Is Co-Portfolio Manager Of The Phoenix Diversifier PHOLIO; Phoenix Diversifier PHOLIO Owns (IGE), (DBC), (DBV)
Gartman Owns (C), (WFC)