Monday, April 23, 2007
Currencies.
Dear Readers, Dear Dxb, Dear Curaki, I am changing here, slightly, the outlook on currencies. This weak should mark an initial top in currencies, bottom in $Dollar. Then the correction should set in for 10-15 days, and then the final Dollar decline towards the second half of May. Good Trading
Subscribe to:
Post Comments (Atom)
13 comments:
Dear Boris,
Shouldnt the rise in $ put pressure on the market then?
Hi Boris,
Thanks for your updated currency outlook. That is very interesting. I will follow this scenario intently as I believe you may be right. BTW, you are right about lack of USD coverage. Even many supposed newsletter contrarians don't make any mention of a possible dollar rally. It is almost unanimously bearish. The shills are alive and well.
Thanks.
Danno
FYI - From Fred Cederholm:
In calendar 2007 US/us is right on target for buying some $ 800 BILLION more of foreign made “stuff” than we are selling of our own products to the rest of the world. That breaks down to a “net” outflow of newly printed bucks to the tune of almost $ 2.2 BILLION per day! This has been going on for quite a while, so it should come as no shock that there are at least four geo-political entities which have accumulated dollar holding in excess of a TRILLION, EACH! These are the Chinese, the Japanese, the EURO (currency) zone, and the Arab OPEC’s. When you sit on that huge a block of Dollars, do you continue to hold them – watching them erode in value, or do you try to convert them to something else?
When “We the people…” watch and attempt to track the unfolding developments in the equity markets (unless there is an announced take over), we only know the volumes of the stocks traded and at what price. So… just who was doing all the buying this past week - pushing up prices/ markets to record levels - or almost record levels? Just where was all that money coming from? I’ve got a pretty good idea, and I TH*NK you do, too. I’m Fred Cederholm and I’ve been thinking. You should be thinking, too.
Dear Lagscrew, Initial reaction, like right now, seems to be the influx of EUROPEAN investment is supporting the market. Eventually You are correct though. As the actual rise in $ will be have a company if Interest Rates rising. Good Trading
Dear Danno, This is the secret of the top. Nobody knows it is coming. Except us, of course. Kidding you know(: :). Let us hope we got it. Good Trading.
Dear Sqroot this is a quote from your quoted text.
When you sit on that huge a block of Dollars, do you continue to hold them – watching them erode in value, or do you try to convert them to something else...
Well, we should also ask a question. Do you stop taking worthless $ from the one and only superpower roaming the earth?
Good Trading Dear Sqroot.
Ha, right you are Boris! Good Luck!
We can see the working of the new China government investment entity. They are buying the US market diversifying their USD from the treasuries. (they always buy at the end of the day)
Funds are moving from US treasuries into US equities, towards a higher risk investment. Their strategy seems to be working. Buying up the Dow, leads on the Shanghai market.
It is an endless drive, as long as China has a trade surplus with US. Hence the market is going to rally endlessly, as long as more USD are printed.
Literally we have helicopter Ben spraying dollars. Hence the market becomes immunized from any subprime woes, housing crash.
This has made the market crashproof.
Only an exogenous event would trigger a meltdown. E.g. California Earthquake, War, unexpected catatrophic events.
Otherwise, every correction would be bought into. Every correction becomes milder and milder.
Hence we may be calling tops all the way into Christmas.
As for USD, the decline becomes a non-event. US is spreading its woes onto the European, Asian. Hence expect a slowdown in Europe, Asia, while US recuperates. (weak Dollar spurs manufacturing).
Hence the greatest contrarian thinking would be 2nd half of 2007, we see the changing of batons between Europe/Asia to US.
While of course US would recover towards end of yr. Having said that, USD to 1.40 Euro is easily reached before July.
Dear Dollarproaragon,
I have all the respect for your arguments. Clear and intelligent indeed. Where I have some problem is with the conclusions. $ 140 against EURO is possible, but I doubt this is for this JUNE. Timing wise we have the May top. and 137.5 140 are my targets. I lean to 137.5. The other issue is that $dollar has already declined considerably to spur the manufacturiing, hence the $dollar turnaround nobody, but we expect. By your own arguments too $ dollar must get stronger. You prefer to think that it will take longer. We think it is within next 3-4 weeks.
As far as the calling the tops. We have made more money calling the tops than people that are holding the staff for last year. Why bother with months into the position when you can make more money in short term and sleep better. Granted most of people can not do that. Besides Top called in QQQQ for last november is scceeded today by less than 1%. And more so, if somebody is bullish on US stocks, why do not they simply buy EURO/GOLD or URANIUM?. Being in US stocks is a losers game. Do had recovered 50% of 2000-2002 loss. Great bull market... Ha. Notwthstanding your excellent argumetns about what is going on, we have a unique way dealing with the situation. Appreciate the input and pleas come back for stimulating discussions. I, for one, would love for our readers to get as much of different opinions as possibel. Good Trading
Dear Dollarproaragon. Sorry for fast fingers, but I am sure you can understand every misspelling and it's meaning. Like "Do receoverd". In English means DOW has recovered. etc...
Good Trading
Dear Dollarproaragon,
Just so that our position is not misinterpreted. We did not call tops. We called local tops and made money on them. Did not only we did not call the top. We gave you chart from March to August ( "August Again") that has called for a top in April/May period. And that is exactly what has happened, did not it?. Entire world has seen (http://www.safehaven.com archives) this article. I am not sure that you implied, but I just want to make sure that nobody gets a distorted idea that all we do here is call false tops. On the contrary, we have been the most precise ( in front) caller of trends of any advisory service in this entire world. Can we be wrong, yes! So far so good though. Good Trading
Dear Boris,
does this slightly changed outlook mean you don't expect to see 115-112 for USD/JPY in mid may but at the end of May? Did outlook for stocks remain the same? Thanks
Dear Curaki outlook for stocks has not changed and the outlook for currencies is only very slightly changed. that is insted of the secondary low or the the low in $ dollar coming before the mid May it is coming at or just after mid May. This translates in JPY top a bit later, not next week and perhaps even not the week after, but after 2wks from here.
Good Trading
Post a Comment