Both the Dollar Index (DXY) and the Commodity Index (CRB) are approaching critical technical inflection points. However, it is the position of the CRB (lower chart) that is of most concern.
Let's notice that the CRB has been under pressure for the last three weeks and appears to have decisively violated its 3-year support line en route to a retest of its Q4, 2011 Double Bottom at 292-293. This level must contain forthcoming weakness to avert downside follow-through towards the 250-247 target area, a 15% decline that could reflect a global economic slowdown with deflationary implications.



