PROBABLY!
That does not mean the trend won’t continue or even accelerate before it ends.
In the meantime, calling Tops and Bottoms is just not that important. A good article here from Michael Kahn on the US dollar trend is worth a read .
The way the dollar acts seems climactic in nature and that is why I am fearing a market event. Too many recent breakouts in my portfolio have reversed fast and turned negative – SINA, NDAQ, CSTR, BBBB and many all-time highs I never added. I don’t have a complicated system of stock selection or money management, but the vicious price action speaks loudly. It has my full attention.
I am building a list in case this week gets messy. You should too.
Howard, Take 2 Valium and drink a 1/5 of Scotch. Q3 GDP 3.9% 166,000 jobs added last month. The only market event coming up will be the +500 point day next week when all the puts /shorts get covered in a mad frenzy. Ask yourself this with a 10yr time frame: Would I rather be sitting in a 3 bedroom house in Miami, Florida or running a 300 P/E Chinese IPO. I will take the thongs down in South Beach.
Rubber dog shit is always rubber dog shit.
I don’t buy the too crowded/too oversold argument for the USD. For starters take a look here: http://bespokeinvest.typepad.com/bespoke/2007/11/dollar-oversold.html
On top of the technical picture you’ve got ben “spineless” bernanke running the fed who is more than happy to cave into debasing the currency because wall street throws a hissy fit. You’ve got silence on the part of european policymakers (save sarkozy) expressing concern about a strong euro. I could go on but the bottom line is that the dollar is weak both fundamentally and technically. I don’t see any kind of abrupt turn save from a black swan type of event…
go cheesefries
What do you mean “building a list”?
Dollar trade is always crowded and still dominated by longs: Uncle Sam, the good ole Peoples Republic – just for starters.
To cheese’s first point, with last week’s trade data and coming inventoriesd, Q3 GDP will likely be revised to 5%. Yet in q3 the Fed started lowering interest rates. Non farm payrolls (+166k) and accopanying household survey went in totally opposite directions. There’s a 100% chance according to Fed Fund futures we get another quarter point cut in December. The Fed is not paying attention to the headline numbers.
No 500 point up days coming.
Love you baby, A good contarian article, but I wouldn’t put any money on it. The Dollar may boucce to 80 in coming weeks, but follow the trend,plus stong resistance qt 80. A good way to play thiss may be to chance to get into gold on a dip, which is now overdue.Moere important how is golfing in ARZ this week
JM
I agree with the counter trade on the $. problem is mr. goldilocks (kudlow) thinks so too.
JimK,
So your saying the Fed is cutting rates not to offset slowing growth, but to provide liquidity to the money centers with the only curb being inflation?
Miss your blog!
Just caught this from Reuters:
Federal Reserve Chairman Ben Bernanke will discuss the central bank’s communications policies in a speech next week, the Fed said on Friday, in all likelihood bringing to conclusion a long-running review.
Fed sources said last month the bank was close to agreeing to changes in its communications strategy that would include extending the horizon of published forecasts to three years from two.
JimK,
So your saying the Fed is cutting rates not to offset slowing growth, but to provide liquidity to the money centers with the only curb being inflation?
Miss your blog!
caught this from Reuters:
Federal Reserve Chairman Ben Bernanke will discuss the central bank’s communications policies in a speech next week, the Fed said on Friday, in all likelihood bringing to conclusion a long-running review.
Fed sources said last month the bank was close to agreeing to changes in its communications strategy that would include extending the horizon of published forecasts to three years from two.
good stuff everybody. nice to see my dentist from toronto in the comments :)
cheese – it is good to see the great jimmy k at least in my comments