Dogs can smell things we humans can't even begin to imagine smelling. Dogs can smell a tiny bit of a drug, even if it's hidden inside a container of coffee, amonia, etc. Dogs can smell cancer cells deep inside the human body. I would imagine dogs can smell the male of female hormones as well.

I find the theory that dogs can smell emotions very fascinating, incidently. We always say that our pets "have ESP" or "just know" when we are feeling happy or sad, even if we aren't showing it in our behaviors. One theory states the every emotion has a scent, we just are incapable of smelling it.