Thursday, October 25, 2007

Limits


N QQQQ 53.27 - 54.04(3rd)
N SPX 1510 - 1519

YEN i s doing the obligatory morning down push
1o:11 ET, OK YEN's done BSing so you can go to normal life, indices in + territory
Comments from Mark A. Lytle:Boris, very interesting moment..the two thick black dashed lines are the 62% retrace of the wave from "purple" B to C and the 38% retrace of the whole move from the "Top" to big red wave A..and the 30 minute bollinger bands have overlaid on top of them and at that point market action bounced off these combined resistance levels... If the $spx "B' wave finishes here, it's likely the Nasdaq could be done also..we'll see.. Regards, Mark L.
12:52 ET, this looks like a good time and formation for YEN to stop rising. What follows is market rise? Watch that YEN dos not fall through 113.92!
13:30 ET, Fell Through, but recovered immediately. Just need to make sure the new low 113.78 does not break, that will not be good at all
CARRY OR NOT TO CARRY
Dear Byzanman/Readers, Carry-Trade That is what we need to rmember. The speculators love this. It involves borrowing money in YEN and cause the cost of borrowing is ZERO, if are Japanese and near 2.5 % if you are not, it pays to borrow and invest it in something ( CD or Writing covered calls or buy you another home or whatever you please). The Japanese housewives invest in New Zealand Dollar, cause it yields 7%, versus YEN ZERO. Clear so far? Ok, In short there is a lot of speculation going on with the "cheap" YEN, thus the word carry-trade, it take so little to carry it OK? Now with over TRILLION Dollars in investments like this ( I sure banks borrow at ZERO and charge 30% for fees to credit card holders late? or to trade against you.) . So do the Brokerages and hedge funds of all sorts. No wonder when YEN moves the world moves, cause if YEN is strong and speculators are afraid they dump everything at once...
Opposite is true when YEN is low or stable. Now if you are CENTRAL BANKER anywhere and would like to "manage" few crazies, what do you do. YEN IS YOUR TOOL my friends. Hey, I do not know, they do not invite me to those meetings where these things are discussed. I just think for myself, putting two and two together.
We will talk more about this

24 comments:

daveo said...

Boris, is spx uplimit right ? or 1529 ? Thanks, Daveo

John said...

Boris,
thanks
Old John

lagscrew said...

Interesting story on silver storage

http://www.investmentrarities.com/weeklycommentary.html

lagscrew said...

Looks like it got cut off after weekly --it is

commentary.html

lagscrew said...

looks like the yen from the past week is nearing the pinch point of trend lines here

boris said...

Dear Dave
SPX up limit is correct,

3rd is at 1521 and 4th at 1525

Good Trading

boris said...

Dear John, Monring Jon,
Good Trading

boris said...

Dear LagScrew,
Thanks

Good Trading

Paul said...

Good day Borris,

Oil, is it a shorting opportunity or are we headed for $100??

Always thankful for your time and knowledge.

Paul

boris said...

Dear Paul,
As I remember printing on this blog, I do not see what is going to stop the OIL before 115.
the level of 82.5 was the only hope . The other hope is that the "POWERS TO BE CHANGE THE MIND ON WHERE THEY WANT TO TAKE THIS SUCKER"

Chances are not good they are ready to do that.

Good Trading

John said...

Being a real novice, if I were running a scam,I would.
Bring the market back up from its lows like yesterday to wash out the shorts and the longs.
Today, I would do exactly the opposite. Do not bring it back.
Old John

lagscrew said...

For those who missed the free $$/yen live chart

http://www.netdania.com/ChartApplet.asp?symbol=USDJPY

Damien said...

Hi Boris,

Havent spoken in a while but are intersted in your take in the homebuilders. Whats your thoughts on LEN & DHI at the moment?

Damien

boris said...

Dear Damien,
Homebuilders of today are like the .COM of 2000.

They are down 65-87% and who knows where the real bottom is timewise.

There is some value in those stocks for those willing to wait. LIke there was value in YAHOO and CISCO and AMZN in 2002. Same approach, but I would wait till FFEB/MAR 2008

Good Trading

Mark P said...

Hi all,

Anyony shorting apple, take the money and run - Looks like is headed to the next fib extension - 195 ish.

Mark p

John said...

Mark,
Implications for the ndx??
Old JOhn

Mark P said...

Hi John,

Presumably higher - not necessarily much higher. This rally to me suggests that we aren't getting a C leg of the correction. The rally up from August (assuming this is so) till today completed 4 legs up and now we are in wave 5. 1490 SPX was the line in the sand for larger correction unless something dramatic happens, the trend is up for now.

Mark P

Byzanman said...

Greetings Boris,
Can you please spare a moment and clarify the significance of the yen movement in the price action of
the market ?

I am very confused with this.

Thank you !

lagscrew said...

Old John

I went thru the house problem back in 1990 where I just had to let someone take over the loan, which I had paid on for 9yrs.

I also had made many improvements to the home. We basically started all over again here in Washington State. We are fine now.

I feel for you

LAG

Paul said...

Thank you Boris for the carry trade explanation. I understand better now but which one leads? Does the market going down create panic in the Yen or does the manipulation of the Yen create panic in the market?

Also, I don't understand how $90 oil is not creating a painc in the stock market? I recall when $60 oil was bad for the market? Is it because of where the US $ is? Is oil then not really $90 in terms of real dollars?

Thank you Boris for educating.

Paul

boris said...

Dear Paul,
The reason the OIL at 90 does not yet affect the people is that it has been done "gradually" this time. OIL you see, is a tool for collecting taxes, after you promised to peoople that you will reduce the taxes ( which is what this administration did).

The learned from 1970's not to let the "gas lines" happen. Not good for business...

About the YEN/SPECULATION. Just like in anything, the chicken and egg problem exists, but what else do you expect when everybody is looking at the stock market and YEN at once!

But as I said, if you are a powerful central banker, you can get a nice "manipulation" going when you need to "lower rates" say. You just create a little panic and there you are...

Good Trading

John said...

Boris- Mark,
thanks for the assist.
made a couple of dollars today
Old John

boris said...

Dear John,

May this be one of many...

I blessed you, now it is GOD's turn to do the same and you will be set.

Good Trading happy to hear.

daveo said...

Does anyone know if Jim Taylor, JD is ok ? I hope the fire did not do damage to his home.