It is no surprise that commodities would drop sharply following yesterday's sudden surge in the value of the US Dollar. The price of Spot Crude Oil alone dropped over $4.00 a barrel to trade at $82.50 in this morning's early hours. The question still remains as to whether market forces resulting from speculation about supply shortages will be enough to correct the price back up again towards $86 and beyond.
A commodity plunge may have actually been overdue. The Dollar has been gaining steadily this past week, but commodities have seen very little corresponding sell pressure, as should be expected. In the case of Gold prices, traders actually witnessed a rise in value commensurate with the gains being made by the buck, which seems counterintuitive to savvy commodity traders. We may see commodity prices continue their downward plunge if positive news doesn't reintroduce a level of risk back to the market.