Oldtent Archives 2007 - 2008

When the US$ is very strong but the yen even stronger the Oz and the NZ currencies get smashed.

  Your outcome would be preferred. I’ve had enough of these characters, the dark needs to be brought to light.

   Still gonna look up at least once on Oct. 14th

When we discuss the YCT, there is no reason to always draw immediate parallels between it and the price of gold.  Gold is both a currency and a commodity as you can see on days like today. You can just take the YCT discussions at face value as a concept. 

The Japan CB loans out cheap money that is borrowed is massive quantities.  People buy things with it: Euros, oil, real estate, they margin foreign equities or buy commodities typically denominated in one of the commodity currencies (AUD, CAD, NZD).  The same thing happened when the FED lowered interest rates to near zero back in 2002. 

What’s impacted is anything where traders can borrow yen cheaply and get a better return somewhere else.  One day, there is a massive shift in everyone’s priorities.  All of a sudden the priority is to delever, to reduce risk, an urgent need to pay the Japanese banker back before the Yen appreciates too quickly and gains evaporate in what you purchased with those yen.  We just had one of the strongest moves in the Yen in like 2 years - while most everything else crashed hard.  This was no casual coincidence, rather it moved with harmony - the mechanics of the market.

I like to use the XEU/JPY ratio because it is a significant cross rate that is widely traded and followed.  Both currencies are the largest components of that make up the dollar basket so it’s important.  The yen and dollar have both been weak relative to the commodity currencies and stable european currencies the past 7 years (XEU, CHF, GBP) — so I like to compare the contrasting currencies — not two weak ones … to represent the YCT as a concept.

jessescrossroadscafe.blogspot.com/2008/09/carry-trade-currencies.html

 I am in no rush to buy stock of Bank of Montreal, TD Bank, or ScotiaBank but I expect these to be in our portfolio sometime soon.  In the meantime, with cash that is becoming available this week we are increasing our position in natgas-weighted Paramount Energy Trust.  At its current unit price, its annual yield is over 14 % per year.  Best wishes.  Equiz.. 

http://stockcharts.com/h-sc/ui?s=PMT/UN.TO&p=D&yr=2&mn=0&dy=0&id=p02965838429

SMN and DUG are two ETF’s that you buy on weakness, not sell. They are in uptrends. As commodities and oil are getting nailed, these two guys are going up. As you can see from the weekly look, IYM is going down faster than it went up, a bull market in reverse if you are holding SMN which moves inverse to IMY.

DUG is a short oil ETF. When oil goes down DUG goes up, simple as that. If you recall the last time I posted on these two short ETF’s I said to buy them on weakness as they had just broke out from their bases. DUG had a beautiful H&S base that it had just broke out of and I said to buy it on weakness, meaning the backtest of the neckline. This is what I love about charting. Friday DUG did its backtest and was sitting right on the neckline when IKE hit the gulf. Again everyone gets all excited and thinks oil is going to go thru the roof with all the damage and shut downs taking place to the oil rigs and refineries. Nothing could be further from the truth. As DUG was sitting on it’s neckline oil was sitting right on top of a previous rectangle consolidation pattern which should have been strong support for a bounce of some kind. I told a friend this weekend that oil would get a small $10 dollar pop, back up to backtest the neckline that it just broke out of, or we would gap down thru the top support rail of the rectangle and totally fake everyone out. Oil was down huge today so that answers that question. The markets work in mysterious ways, always doing what you think they shouldn’t be doing.
Good trading Goldielocks…Rambus

I agree that this is an orchestrated takedown…but disagree that they will maintain control…according to the astrological roadmap…in this case, the Pluto Cycle Chart.  Pluto rules the masses and in the near future will conjoin three planets:  Uranus, Saturn, and Mars…rebellion from chains that bind…a regeneration of basic structures of life…and a time of severe struggle over tremendous odds.  The struggle will be long and arduous due to the fact that Pluto will retrograde on its conjunction to Mars, a very powerful and meaningful station…power to the people. 

Perhaps we may see the Amero or some other substitute for awhile…but the days are numbered for the dark side…because the tipping point has been reached…like a see-saw, they’ve been on top and now the weight of their ugliness is forcing their side of the see-saw in a downward direction.  That’s my take, anyway.

Moggy

Richard Wright

The family of Richard Wright, founder member of Pink Floyd, announce with great sadness, that Richard died today after a short struggle with cancer.
www.youtube.com/watch?v=vyqgjCKm9nQ

….I see it has been up in tandem with the gold bull….from 2001…are you implying that as the Euro loses ground against the Yen .this means cheap yen are being bought back and the Higher yeilding Euro sold….to unwind the carry trade ?

….I see your point BUT….Yen Dollar is also a carry Trade no ?

…the $Yen Chart is very well correlated to the Price of Gold too…

…look at those charts back in my previous post….Gold and $Yen Both Peaked in May 06….then corrected together…then rose together from August 07 to march 08 where they both made higher highs…and have come down together….Yen breaking out of this $Yen correction would be Bullish for gold if this correlation holds….

….Maybe the Ten and Euro will strengthen against the Dollar…with the yen leading the euro too….thats all bullish for Gold too

$Yen

stockcharts.com/h-sc/ui?s=&p=D&yr=3&mn=0&dy=0&id=p10912865117

$Gold

stockcharts.com/h-sc/ui?s=&p=D&yr=3&mn=0&dy=0&id=p10912865117

Interesting the Euro never corrected in May 06…as the Yen and Gold Did…$EURO

stockcharts.com/h-sc/ui?s=&p=D&yr=3&mn=0&dy=0&id=p10912865117

…

Below the bottom bracket.  Maybe a retest from the bottom - then it’s lights out

XEU/XJY chart

…look at the Yen Chart and Gold Chart….they both peaked in March and both have corrected to now

…Yen may be breaking out of its correction ?

When it hits 80/barrel were a lot closer to less forced liquidation

well, I’m not much of a wave counter…but I will be buying USERX with Interest on proceeds from a comm. prop. sale

, dollar cost averaging in about 5k per month…

  I need to disagree just a bit. Yes, this is what needs to happen in order to purge the system.

  Here’s where I may differ: IMO, this is an orchestrated take down of the U.S. financial structure by the real money power - we are now entering the “problem” phase.

   Soon, when Joe 6 and all the government employees realize that their pensions are toast we will enter the “reaction” phase. Weeping and gnashing of teeth.

   Then, the same crowd that swindled us in the first place will propose a “solution” - but not until the masses beg them to do something, anything to save them.

   I don’t know if that will be the Amero or what their solution will be - but I am certain it will come from the same bunch of rotten apples.