The U.S. dollar, which has recently been rather steady, is sharply lower today. September futures for the dollar are trading at 82.30, down 0.90.

Better data coming out of China and Australia pushed the dollar lower, according to traders. While that may be true, it really doesn't explain why the drop was so sharp.

Let's look behind the scenes a bit. Do you remember the rally off the 2009 lows? It was fueled mainly by a weaker dollar, which, in turn, drove up the prices of commodities and the stock market.

Oil prices have been steadily falling over the past week, but reversed course today and managed to gain $0.89 a barrel to close the day at $72.52.

Today's rise came despite a bearish inventory report that showed oil inventories rose by 4.11 million barrels last week, well above the 300.000 barrels that analysts had been expecting to see.

The U.S. dollar could drop below 84 yen, according to Gaitame.com Research Institute. Gaitame uses a technical tool called the Bollinger Band, named after its founder John Bollinger. Bollinger bands predict 95% of a security's movement using moving averages and standard deviations. The bands show the dollar bouncing off the lower band six times in the past four weeks. This suggests a strong downward trend.

Traders are watching the 84.50 yen level. If it is broken, the next stop is the 84.00 yen level. The dollar has not breached the 84.00 level since 1995. If the dollar breaches the 84.00 yen level, the next stop is 83.00.

Thanos Papasavvas, head of currency management at Investec Asset Management is bearish on the U.S. dollar, CNBC reports. He is speculating that the Federal Reserve will change its language to indicate downside risks to the U.S. economy.

He points up the contrast between the eurozone and U.S. economies. European leaders have taken measures to cut their deficits and spending. The U.S., on the other hand, is still spending to stimulate our economy. Papasavvas told CNBC that the "Dollar weakness will be the story of the next few months."

After selling off its three month lows of $1,156.90 per ounce, prices of gold have been coming back. Driving the yellow bullion higher is the euro, which is strengthening against the U.S. dollar, and rising prices of oil and even stocks.

But as gold comes back off its lows, is it time for investors to get in? If stocks continue to rise, it seems that gold could fall further.

We turned to James Altucher, managing director of Formula Capital to find out.

September oil futures traded at $79.12 per barrel, up $2.56 (as of 14:40 EDT). Brent crude was up $2.24 per barrel at $77.61.

The reasons for the jump were varied. Some cited the possibility of another storm in the Gulf, others cited the fact that oil has been holding above its 200 day moving average. Stocks and commodities trade and then we write about the reasons for the prices changes. One big mover was the US dollar. It took a hit. The September contract traded 82.975, down .798. When the dollar goes down, buying oil gets cheaper.

On the cusp of stress tests for Europe's banks, the continent may have already passed a major stress test -- one for the euro currency, Bloomberg News reported Thursday. A scant two months ago, the dominant concern among institutional investors was not the return on their investment in European government bonds, but the return of their investment.

Institutional investors drove up interest rates for debt-plagued nations Greece, Spain, Portugal, Italy, and Ireland, and banker-to-banker distrust increased.

Oil prices headed lower on Wednesday after the Department of Energy announced a surprise increase in inventories last week.

Analysts had been expecting to see oil reserves decline last week by 1.4 million barrels, but the weekly inventory report showed that inventories actually increased during the week by 400,00 barrels.

The currency of the month in the foreign exchange -- the equivalent of the 'flavor of the month' in the currency markets? You guessed it -- the euro, which surged above $1.29 Thursday morning before pulling back slightly at mid-day.

The roughly 2-cent move higher Thursday continues a remarkable rebound for the European currency.

A month ago, the euro plunged to $1.16 amid a vortex of news that one or possibly all of Europe's debt-plagued countries -- Greece, Spain, Portugal, Ireland, and Italy -- could default. And there was even talk of a 'break-up of the euro-zone' and possibly an end to the euro.

Greece's debt woes this spring and talk of comparable problems in other debt-plagued eurozone nations, such as Spain, Italy and Portugal, had the euro bears talking euro-dollar parity as the euro plunged to $1.1877 in early June -- a four-year low.

But a month later the euro has strengthened 5.8% to $1.2574, and suddenly the teeth of the euro bears do not look as sharp.

Last week was unusual when you compare the traditional relationship between gold and the U.S. dollar. Out of left field came a stunning rally in the euro to the $1.25 level, after being beaten down to $1.18 The U.S. dollar moved in tandem on the downside, to the 85.00 level vs. a basket of currencies.

Normally, gold will move inverse to the dollar; i.e., when the dollar drops, gold rises. Last week, however, gold sold off sharply when the euro rose. The presumption was that Europe was on the mend and the crisis was over.

Just a week or so ago, traders and analysts were looking for the euro to trade at parity with the U.S. dollar. Now it seems that the markets got turned upside down.

The euro has powered higher for the last several days and is now trading above $1.25 The reason given was traders were worried that banks would have to borrow heavily from the European Central Bank (ECB) to meet their financing needs. However, they borrowed less than anticipated. Then there was the fear that Spain would not be successful in issuing 3.5 billion euros of five-year bonds. That also did not happen.

Tuesday was a tough day for oil traders, with oil prices falling 3% to a two-week low.

The main thing spooking traders was a report that indicated growth in China was running lower than previously expected.

The Conference Board announced that, when it previously released that China's leading economic indicator rose by 1.7% during April, there was a calculation error. Instead of growing by 1.7% in April, it actually grew by a mere 0.3%.

China is developing fast and, even though it has some issues with human rights, pollution and corruption, people have been speculating that it could be the next global super power.

China has a population of 1.3 billion, which is four times the U.S. population of 308 million. Simple math dictates that if four Chinese people can match one U.S. person in productivity, China will surpass the U.S. in production.

Now that China has agreed to a modest appreciation of the yuan, should investors expect more of the same in the quarters ahead?

At this juncture, no. The yuan's record high of 6.7980 yuan to the dollar reached Tuesday represents just a minor adjustment in Beijing's monetary policy, and that's what investors should look forward to: an incremental and very slow effort by Beijing to let the yuan appreciate, with limits.

How much will China let the yuan appreciate in a year? Perhaps 5% a year. The aforementioned may not seem like much but it does represent a Beijing response to international political pressure, primarily from the United States and the European Union.