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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: William H Huebl who wrote (77049)	10/7/2007 7:12:20 PM
From: Real Man	Read Replies (1) \| Respond to of 94695

This is the key Yen per dollar chart, which is the only currency chart that matters to the stock market The bounce of dollar against Yen was not nearly as strong as the stock market bounce. As dollar/Yen turns back South, so will stocks. Note: the dollar index may actually bounce as the dollar goes South against the Yen. However, it appears the dollar just went down against everything. Not much of a bounce against Yen, which always gets even weaker than the dollar. So? Maybe we get some October MELT. If we get Yen melt - up (a meltdown on this chart above), then we get October BK in stocks -g- That's the carry trade chart. Euro/Yen carry plays an important role. So, normally, Euro would tank against Yen and the dollar on such event, bringing down USDX, which is 57% Euro. Normally, Yen strengthens more than the dollar when the dollar does strengthen. However, this time could be different, as the dollar might just tank against everything.

To: William H Huebl who wrote (77049)	10/7/2007 7:30:33 PM
From: Real Man	Read Replies (1) \| Respond to of 94695

Explanation: As you keep your eye on Dollar/Yen, you can see the big 400 Trillion megaton carry trade derivatives bomb ticking. Once Yen is off to the races, that would mean the big derivatives bomb just went off. -g- You can see it was very close in August, it actually went off, but the Fed stopped the total nuclear annihilation countdown. So far it's the same carry trade that dropped the dollar (in the usual, calm, non-nuclear way, the way the machine normally works) as lower rates translate right into lower currency values in this complicated machine. (Higher rates or expectations translate into higher currency values, which is why the dollar was supposed to rally on Friday). Fed cut helped it for sure.