Commodity prices (especially oil, gold, and silver) have been falling sharply since July 15. Unfortunately, prices at the producer level and the consumer level are still rising.

Commodity prices had been soaring since last November, and producers couldn’t raise the prices of their end products fast enough to keep up. So you can understand if they are hesitant to freeze prices or lower them now that commodity prices are falling.

Combined with inflation running high and consumer confidence running low, this means the retail sector will struggle in the coming months. Most of the companies in the sector have already reported second-quarter earnings. And most were able to meet or beat expectations. However, a number of them have lowered expectations for the third quarter.

Unfortunately, there isn’t an ETF that makes money when the retail sector goes down. However, staying away from the retail sector can benefit your portfolio. Should the economy turn around in the fourth quarter, retailers will benefit at Christmas time. By then, their earnings expectations could be extremely low and easy to surpass. So stay away from the retail sector for now… but look at it again come the holiday season.

[Ed. Note: Making money these days is as much about knowing what NOT to buy as it is about buying right. Investment analyst Rick Pendergraft can show you an embarrassingly simple system he uses to make investing decisions. Learn the details

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