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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: russwinter who wrote (24461)	1/12/2005 9:42:36 AM
From: gregor_us	Read Replies (1) \| Respond to of 110194

Last Week Was Clearly the Time to do a Resumption of Trend trade, with the comical (and cynical) "rally" in the USD knocking back all the anti-dollar trades. On the political front, I'm looking for Washington (Snow/Fed) and Europe (Issing) to drive the Bulldozer of complaint further forward today, this week, and make verbal war on the Asian currencies--in the wake of today's Boffo Trade Numbers (replete with upward revision of OCT--and a FALL in exports. Whoo!). Of course, every move they make now sets off other pressures, as you have pointed out. They are splayed, in a cats cradle of offsetting reactions. So they can go ahead and verbally "hit hard" Asia for the sake of public consumption--but they're the guys who have kept the mountain of treasury supply off the open market. My answer: they have to feed the stock market now and risk gettng the USD below 80.00 on the USDX. LP

To: russwinter who wrote (24461)	1/12/2005 9:57:24 AM
From: gregor_us	Read Replies (3) \| Respond to of 110194

Important to Note We're Still in the Period Where Official "reversals" like Snow's comments last week can act to bring the USD back up. Washington still has the power to reverse. We must watch like hawks therefore for the signs which tip a change in that ability, that power. I am tempted to call today's Trade Numbers something akin to a Sea Change for the whole forex complex, coming as it does after a sharp, unsustainable rally last week, and all the chatter "against" Asia. The "VIX" of Official Banker Chatter is rising. That too is a sign. I would also suggest today's "reactions" to today's Trade Numbers--again coming when they come, during this drama of the dollar--are going to take time to be fully reacted to. We've seen big moves already in the JPY but going forward we may reflect there was under-reaction in the market (as there often is). I think the dollar "rally" of last week set the USD up for a more terrible fall, and I think that process was set in motion this AM. LP