RAOUL PAL: The Dollar Surge And Oil Crash Are Far From Over

Former GLG macro fund manager Raoul Pal told Business Insider that he thinks that the rally in the US dollar has a lot further to go.

He also said that oil prices should continue to trend lower, but they're due for a bounce.

Pal, the author of the Global Macro Investor newsletter and founder of Real Vision Television, has been writing about short oil and long the dollar since the spring of 2014. Back in mid-November, he predicted that oil could fall to $30 or $40 per barrel.

Long dollar and short oil have been the two biggest trades since the middle of last year.

"My view on the dollar is that it has a lot further to go," Pal told Business Insider in an email this week. "I do think that emerging markets are likely to get hit very hard as the dollar continues to move and the $9 [trillion] global carry trade starts to become unraveled."

He continued: "My view on oil is that it should well continue but it is due a bounce at some point soon. That bounce may last a couple of months but once the global economy starts to weaken, which is my base case, then I think oil will continue to fall. Currently it is just moving in line with the US dollar."

Here's a look at the relationship between oil prices and the dollar index. Note, the y-axis for the dollar index is inverted.