We've heard for several years now that the twin deficits were going to destroy the dollar. When this didn't happen the same doomsayers claimed that rising oil and gold prices portended the imminent collapse of the dollar. Wrong again. In the past when gold was up the dollar was down. Now we have the dollar holding its own while oil and gold have increased dramatically in price. These are interesting times. My guess is that because the dollar is the world's reserve currency, global commodities trading is taking place mostly in dollars. Rising oil prices have created a demand for dollars. The dollar is the currency of global liquidity so if you want to conduct international financial transactions, the dollar is the currency to be used and is therefore in strong demand.
Whether this is true or not is secondary to the fact that the dollar pessimists and trade deficit alarmists have been wrong all along.