The U.S. Dollar Index (DXY) from BigCharts:
When supply and demand are roughly in balance, the strength of the dollar rules the price for commodities that are denominated in dollars. (dollar down/commodity up)
Although the Chinese yuan is not included in the DXY, the effect of this order from the Communist Party honchos (October 1 post):
"China tells state banks to prepare for a massive dollar dump and yuan buying spree..."
was caught by the index due to the selling pressure on the buck.
DXY 106.41 last. On the chart, there is that July-August congestion that might be supportive on the way down but if a determined seller punches through that area there is weaker support at 105 from May - July (three touches of the line before breaking through to the upside) and after that the magic number is all the way down at 95.
It all depends on interest-rate differentials between the U.S. and other developed nation currencies. Fed meeting the day after the next CPI report; a half-point rise would be status quo/hold the line, three-quarters of a point and it's a reversal.
