It appears to me that the stock market has driven up to the cliff and is taking a look over. Whether it leaps off (or get pushed) or not is the question. I do not believe the justification or push event has occurred as of July 28. If this pivotal event doesn't occur, then the market just muddles along or grinds back up. There are plenty of things to worry about, but that's always the case. What has to happen to stampede this off the cliff is a galvanizing event that screams fire in the theater.
The one potential event which could do the trick that I see potentially waiting in the wings is a sudden, very large reversal in the Yen. There's an enormous fortune to be made if the carry trade gets suddenly unwound. I was in the UK in the early '90's when currency traders broke the pound so I know it can be done. I have read stories about ordinary Japanese housewives who have made a killing in the carry trade. This would seem to indicate the Yen is ripe for just such an event. However, with the enormous levels of government intervention going on, this may turn out to be just a tempest in a tea cup. It will be interesting (and I hope profitable) to see how it unfolds.
Driving to the Cliff and Looking Over
Started by
Douglas
, Jul 28 2007 04:27 PM
3 replies to this topic
#2
uncleharley
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Posted 28 July 2007 - 05:01 PM
[size=5] Very insightful post.
If I may I would like to refer you to any chart of any major stock index which are published on nearly all financial websites. The pattern for the past week or two is generally referred to as a waterfall. Indications are that the market did not go to the clif and peak over, but it went to the cliff & fell over.
Your remarks on the Yen are also very close to being right on. To see how close, check out a chart of the recent values of the Yen, Last thursday in particular is interesting.
Again, your post is very insightful.
uh
If I may I would like to refer you to any chart of any major stock index which are published on nearly all financial websites. The pattern for the past week or two is generally referred to as a waterfall. Indications are that the market did not go to the clif and peak over, but it went to the cliff & fell over.
Your remarks on the Yen are also very close to being right on. To see how close, check out a chart of the recent values of the Yen, Last thursday in particular is interesting.
Again, your post is very insightful.
uh
#3
nimblebear
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- Traders-Talk User
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Welcome to the Dark Side !
Posted 28 July 2007 - 05:14 PM
[size=5] Very insightful post.
If I may I would like to refer you to any chart of any major stock index which are published on nearly all financial websites. The pattern for the past week or two is generally referred to as a waterfall. Indications are that the market did not go to the clif and peak over, but it went to the cliff & fell over.
Your remarks on the Yen are also very close to being right on. To see how close, check out a chart of the recent values of the Yen, Last thursday in particular is interesting.
Again, your post is very insightful.
uh
Haven't seen you in awhile. Post posts here are
great !
OTIS.
#4
uncleharley
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Posted 28 July 2007 - 05:53 PM
I do more lurking than posting anymore. I like your avatar. Can I have one? 
