The US dollar is in very deep oversold territory. The set up looks interesting for a bounce. If it reaches the 22.5 level on the UUP, a break from the negative trend will be screaming on everyone's screens.
Assuming Bill Gross is right shorting treasuries, rates should rise soon enough. (I think rates will rise due to the strength of the US economy, and exaggerated by the mechanics of the Fed ending QE2.) With the higher rates, there will be legitimate demand for US treasuries, which will also boost the dollar.
If the US dollar looks to rise, US denominated commodities will have pressure. (Adds to the 'short-oil' thesis.)
I do not clearly see how this affects the equity markets. Earnings should not be impacted with the removal of QE2, and subsequent rise in rates. If earnings are not impacted, then their should be little to no damage onto equity prices. Also, there will not be a forced de-leveraging in equities, as Bill Gross' admitted very heavy cash position is indicative of many other hedgies out there. They are in a ton of cash, and ignoring value in equities.
Economic strength and inexpensive equity values should prevent de-railing of the positive trend.