The market seems to be waiting for the outcome of a historic presidential election. In the process, it has already spent precious fuel needed to overcome overhead resistance.
I have said before that the burden is on the bulls now. If this nascent rally attempt has to survive then the market needs to rally quickly on a much stronger volume then of the past few days. I would wait for the market to tip its hand one way or the other before deciding which way to lean. But bulls are running out of time. If they can't rally the market this week then I don't think they stand a chance next week.
The Yen carry mechanism provides the massive amount of liquidity to the world markets as Yen borrowed for virtually nothing is then invested eventually in foreign stock markets everywhere. The real estate markets world wide too benefit because of the Yen carry trade. So a rising Yen is a sure recipe for a crash.
The Yen carry mechanism provides the massive amount of liquidity to the world markets as Yen borrowed for virtually nothing is then invested eventually in foreign stock markets everywhere. The real estate markets world wide too benefit because of the Yen carry trade. So a rising Yen is a sure recipe for a crash.
I think the one factor that has contributed immensely to the recent rally attempt has been the concerted effort by the powers to be to reign in the rise of Yen. In spite of the intervention Yen is still holding on to most of its gains of the past few weeks. $/Yen is still below 100. If it can't get back above 100 quickly and stay there then this rally is bound to fail. No doubt about it.
No comments:
Post a Comment