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Two Ways To Play: Dollar Gets Pumped


Strengthen your portfolio in good times and bad.

Dollar Strengthens

According to Bloomberg, the dollar is set for its largest weekly gain in over three years against the euro. Speculation that officials from the Group of Eight nations meeting over the weekend will favor a stronger U.S. dollar is helping the greenback. The dollar also had its biggest weekly gain against the Japanese yen since 2004. Overall, the dollar has risen against 16 of the most actively traded currencies this week. For context, see Professor Lance Lewis' Paulson's Dollar Bluff.

From the Bull Pen
: For those that believe the dollar has bottomed, the dollar bullish fund (UUP) may be an option. Sell-stops can be set near $22.60.

From the Bear Cave
: The dollar bearish fund (UDN) is an option for dollar bears. Levels near $28.50, which is the 50% retracement from the March high, may be an entry opportunity.

Starbucks: 150 in Europe

According to Reuters, Starbucks (SBUX) plans to open as many as 150 new locations in Britain, France, and Germany over the next three years. In a deal with UK group SSP, coffee shops will be opened near railway stations and in airports. CEO Howard Schultz said in a statement the move in Europe is inline with its strategy to increase its international business and provides a strong platform for European expansion. This month the company also opened its first stores in Argentina through a Mexican partnership. See Professor Geoffrey Helt's column, Starbucks: Alone on Top.

From the Bull Pen: Bulls that agree with Starbucks' strategy can play the upside. Support near $17 may provide bulls with an entry level.

From the Bear Cave
: Bears looking for a downside play may find one in Darden Restaurants (DRI). Near-term buy-stops may be set above $32.

For more ideas in real time throughout the trading day, check out Minyanville's Buzz & Banter.

Quick Check Around the World

Asian trading closed with the Hang Seng -1.87%, Nikkei +0.61%, Sensex -0.40%, Taiwan +0.54% and Shanghai -3.00%.

A glance towards Europe finds the CAC -0.45%, DAX -0.06%, FTSE -0.26%.

As of 8:50 AM EST, S&P futures are higher +7.50 points to 1350, and Nasdaq futures are up +14.50 points to 1953.

A Look At Commodities

In commodities, crude oil is lower -0.49 to 136.26. Gold is down -4.60 to 864.60. Silver is also lower -0.040 to 16.445, and copper is higher +1.15 to 354.40.

The dollar index is higher +0.349 to 74.208.

On the Radar

CPI (m/m): 0.6% vs. 0.5% cons.
Core CPI (m/m): 0.2% vs. 0.2% cons.
CPI (y/y): 4.2% vs. 3.9% cons.
Core CPI (y/y): 2.3% vs. 2.3% cons.

10:00 U. of Michigan Confidence: 59.0 cons.

Happy Friday! Have a great weekend!
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No positions in stocks mentioned.

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