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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: robert b furman who wrote (8941)	3/14/2008 4:47:58 PM
From: Oblomov	Read Replies (1) \| Respond to of 33421

They are quotes of the currency ETFs. USD was down hugely against the CHF and JPY, up big against the GBP and AUD. In other words, the low-yielding currencies were being bought and the high-yielding currencies were being sold. The carry trade consists of one selling low-yielding currencies like the Yen to buy paper in high-yielding currencies like the AUD. Many hedge funds put on this trade because they believe it to be low risk. In the right market it can generate huge returns because of the degree of leverage available on the spot market. It looks like this trade was blowing up today. It's interesting that this huge dislocation took place with only a small move in gold... I smell distribution in the gold market.