EUR/JPY Falls In Elliott Wave 1 Down In Advance Of Federal Reserve Announcement
Tuesday, 5. August 2008, 18:00:20
A Financial market report in advance of the Federal Reserve announcement scheduled for 2:15 PM today.
The intraday chart of EUR/JPY, FXE:FXY daily, FXE:FXY weekly, shows a cresting yesterday, August 4, 2008, to an Elliott Wave 2 up of 1.692, and a fall lower in an Elliott 3 Down to trade at 1.680: this constitutes a Major Wave 1 Down, which will be followed by a Major Wave 2 Up, which will then be followed by a Major Wave 3 Down.
There was a further unwinding of the yen carry trade today: it produced a disinvestment from the commodity currencies today in advance of the Fed announcement.
The Euro, FXE, fell 0.72% to 154.84, to the edge of a massive head and shoulders pattern that goes back to May 1, 2008, when institutional investors traded out of the high yield dividend paying stocks to go long with the yen carry traders in CRB commodity futures, and in commodity indexed mutual funds and ETFs such as RJI, USO, DBA, and GLD.
The Yen, FXY, rose 0.02% to 92.18 to reside at the edge of a massive head and shoulders pattern that goes back to July 14, 2008, when the marketplace acted to call the Yen higher as Ben Bernanke of the Federal reserve call for liquification and capitalization of the mortgage GSEs, Freddie Mac FRE, and Fannie Mae, FNM.
The Australian dollar, FXA, fell 1.54% to 91.55 which goes almost back to March 18, 2008 when the Federal Reserve announced assistance in the JP Morgan buyout of Bear Stearn and the provisions of TAF, TSLF and PDCF.
The Candian dollar, FXC, fell 0.6%; it fell so badly that I have to present it in a weekly view which shows three black crows. This chart shows that yen carry traders heeded the announcement of the May 2008 Bank of Japan announcement that rising inflation is an investment risk concern: they sold out of Canada when the news was reported by CEP New on major forex websites such as ActionForex.com.
I expect the commodity currencies to rally some and the US Dollar, $USD, to fall after the Fed announcement. And thus I expect gold, $gold, to rise as well.
I expect a disinvestment from stocks globally after the Fed announcement.
As documented in recent blog articles we have reached Peak Dollar and Peak Currencies.
Gold will be arising as the defacto world currendy and means of maintaining wealth.
The investment demand for gold, GLD, is clearly seen in numerous charts
Gold relative to stocks, GLD:VTI which shows gold's glorious rise in value since the Fed announced the lowering of interest rates in late 2007.
Gold relative to commodities, GLD:RJI
Gold relative to oil, GLD:USO
Gold relative to currencies, GLD:DBV
Gold relative to US Treasuries, GLD:TLT
Here is the chart of gold, GLD, trading 2% lower and banks, KBE, 3% higher at 1:00 PM and hour or so immediately before the Fed announcment.
The Proshares 200% bear market ETF, SKF, which is 200% inverse of the financial sector, IYF, is seen 4.5% lower today.
The USD/JPY rose to 108.29 which makes for a triple top; having hit resistance it will be falling lower. It represents the short selling opportunity of a lifetime.
Gold, GLD, fell 1.7% lower to 86.66 with oil, USO, which fell 1% lower to $96.50.
US Treasury bonds, TLT, fell 0.1% lower to 91.27; its fall lower when stocks are rising confirms that a run on US government bonds is underway. Additional evidence comes from the bond market place calling interest rates higher even as the Fed is expected to hold rates steady: $TYX, the interest rate on the 30 Year US Treasury Bond is seen rising to 45.89 -- 4.589%.
Sectors up include
Leisure and entertainment, PEJ, 4.5%
Retail, XRT, 4.5%
Transports, IYT, 3.5% (higher on lower price of oil)
Dynamic Media, PBS, 3.5%
Gaming, BJK, 3.5%
Global Luxury, 3.0%
REITS, RWR, 3%
Consumer Service, IYC, 3%
Consumer Discretionary, XLY, 3%
Banks, KBE, 3%
Insurance, KIE, 3%
Small Cap Value, RZV, 3%
Real Estate, IYR, 2.5%
The commodity sectors are down on the lower oil; these include:
HUI Indexed precious metal shares, GDX, -4%
Metal manufacturing stocks, XME, -1%
Disinvestment has already started from some stock such as LTC Properties, LTC, down 2.5%.
The Federal Reserve has done all it can do; it was strapped by yesterday's inflation report, and thus is unlikely to lower interest rates below 2%.
The yen carry traders see risk aversion rising due to a number of factors:
1) the level two and level three assets at banks, KBE, and investment bankers, KCE.
2) demand destruction
3) decrease global growth.
The twin well springs used to generate fiat wealth in stocks and bonds have run dry; these being the easy credit of the US Central Bank in TAF, TSFL and PDCF facilities, as well as the Bank of Japan, 0.5% interest loans.
Rising marketplace interest rates, $TYX, and the Elliott Wave 3 Down in the yen carry trade documented above are irreversable; they cannot be turned back.
Disinvestment will now commence in stocks and bonds, to be followed later by more disinvestment in currencies; the US Dollar, USD, will be leading currencies lower in a death spiral lower together.
The Liquidation Thesis will be applied by economic nature: government services and payments, service sector jobs, public and private debt of all types, and unfunded retiree benefits are going to be liquidated, that is done away with. An example will be that the doors will shutter on the assisted living facilities, such as LTC Properties, LTC, -- the US government will not be able to afford the $3,000 a month cost to house seniors in these places.
We have passed from one age into another.
The age of 'investment prosperity is over' and the age of 'financial disinvestment and instability', and the age of 'global governance and state corporate rule' are rising.
One might ask, "How is state corporate rule rising"?
The leaders have announced two 'framework agreements': the Security and Prosperity Partnership of North America, the SPP, and the Declaration of EU US 2008. These give them authority to address events that threaten economic stability, and which provide for economic competitiveness. The leaders have appointed councils, working groups and stakeholders, who work in global government principles and policies of security and prosperity.
I hope that investors heeded my past advice, where I recommended that one invest in gold at BullionVault.com and at GoldMoney.com and that one invest in the in GLD, SKF, RYWJX, and TBT, in a trust account and not a brokerage account.
I also recommended that one open a Forex currency trading account and go short EUR/JPY and short USD/JPY. The weekly chart of FXE:FXY shows the end of the age of investing long with 0.5% interest from the Bank of Japan; disinvestment is now getting underway, and fabulous wealth beyond which I am able to describe is coming to those who are short these two currency pairs in a forex account.
The intraday chart of EUR/JPY, FXE:FXY daily, FXE:FXY weekly, shows a cresting yesterday, August 4, 2008, to an Elliott Wave 2 up of 1.692, and a fall lower in an Elliott 3 Down to trade at 1.680: this constitutes a Major Wave 1 Down, which will be followed by a Major Wave 2 Up, which will then be followed by a Major Wave 3 Down.
There was a further unwinding of the yen carry trade today: it produced a disinvestment from the commodity currencies today in advance of the Fed announcement.
The Euro, FXE, fell 0.72% to 154.84, to the edge of a massive head and shoulders pattern that goes back to May 1, 2008, when institutional investors traded out of the high yield dividend paying stocks to go long with the yen carry traders in CRB commodity futures, and in commodity indexed mutual funds and ETFs such as RJI, USO, DBA, and GLD.
The Yen, FXY, rose 0.02% to 92.18 to reside at the edge of a massive head and shoulders pattern that goes back to July 14, 2008, when the marketplace acted to call the Yen higher as Ben Bernanke of the Federal reserve call for liquification and capitalization of the mortgage GSEs, Freddie Mac FRE, and Fannie Mae, FNM.
The Australian dollar, FXA, fell 1.54% to 91.55 which goes almost back to March 18, 2008 when the Federal Reserve announced assistance in the JP Morgan buyout of Bear Stearn and the provisions of TAF, TSLF and PDCF.
The Candian dollar, FXC, fell 0.6%; it fell so badly that I have to present it in a weekly view which shows three black crows. This chart shows that yen carry traders heeded the announcement of the May 2008 Bank of Japan announcement that rising inflation is an investment risk concern: they sold out of Canada when the news was reported by CEP New on major forex websites such as ActionForex.com.
I expect the commodity currencies to rally some and the US Dollar, $USD, to fall after the Fed announcement. And thus I expect gold, $gold, to rise as well.
I expect a disinvestment from stocks globally after the Fed announcement.
As documented in recent blog articles we have reached Peak Dollar and Peak Currencies.
Gold will be arising as the defacto world currendy and means of maintaining wealth.
The investment demand for gold, GLD, is clearly seen in numerous charts
Gold relative to stocks, GLD:VTI which shows gold's glorious rise in value since the Fed announced the lowering of interest rates in late 2007.
Gold relative to commodities, GLD:RJI
Gold relative to oil, GLD:USO
Gold relative to currencies, GLD:DBV
Gold relative to US Treasuries, GLD:TLT
Here is the chart of gold, GLD, trading 2% lower and banks, KBE, 3% higher at 1:00 PM and hour or so immediately before the Fed announcment.
The Proshares 200% bear market ETF, SKF, which is 200% inverse of the financial sector, IYF, is seen 4.5% lower today.
The USD/JPY rose to 108.29 which makes for a triple top; having hit resistance it will be falling lower. It represents the short selling opportunity of a lifetime.
Gold, GLD, fell 1.7% lower to 86.66 with oil, USO, which fell 1% lower to $96.50.
US Treasury bonds, TLT, fell 0.1% lower to 91.27; its fall lower when stocks are rising confirms that a run on US government bonds is underway. Additional evidence comes from the bond market place calling interest rates higher even as the Fed is expected to hold rates steady: $TYX, the interest rate on the 30 Year US Treasury Bond is seen rising to 45.89 -- 4.589%.
Sectors up include
Leisure and entertainment, PEJ, 4.5%
Retail, XRT, 4.5%
Transports, IYT, 3.5% (higher on lower price of oil)
Dynamic Media, PBS, 3.5%
Gaming, BJK, 3.5%
Global Luxury, 3.0%
REITS, RWR, 3%
Consumer Service, IYC, 3%
Consumer Discretionary, XLY, 3%
Banks, KBE, 3%
Insurance, KIE, 3%
Small Cap Value, RZV, 3%
Real Estate, IYR, 2.5%
The commodity sectors are down on the lower oil; these include:
HUI Indexed precious metal shares, GDX, -4%
Metal manufacturing stocks, XME, -1%
Disinvestment has already started from some stock such as LTC Properties, LTC, down 2.5%.
The Federal Reserve has done all it can do; it was strapped by yesterday's inflation report, and thus is unlikely to lower interest rates below 2%.
The yen carry traders see risk aversion rising due to a number of factors:
1) the level two and level three assets at banks, KBE, and investment bankers, KCE.
2) demand destruction
3) decrease global growth.
The twin well springs used to generate fiat wealth in stocks and bonds have run dry; these being the easy credit of the US Central Bank in TAF, TSFL and PDCF facilities, as well as the Bank of Japan, 0.5% interest loans.
Rising marketplace interest rates, $TYX, and the Elliott Wave 3 Down in the yen carry trade documented above are irreversable; they cannot be turned back.
Disinvestment will now commence in stocks and bonds, to be followed later by more disinvestment in currencies; the US Dollar, USD, will be leading currencies lower in a death spiral lower together.
The Liquidation Thesis will be applied by economic nature: government services and payments, service sector jobs, public and private debt of all types, and unfunded retiree benefits are going to be liquidated, that is done away with. An example will be that the doors will shutter on the assisted living facilities, such as LTC Properties, LTC, -- the US government will not be able to afford the $3,000 a month cost to house seniors in these places.
We have passed from one age into another.
The age of 'investment prosperity is over' and the age of 'financial disinvestment and instability', and the age of 'global governance and state corporate rule' are rising.
One might ask, "How is state corporate rule rising"?
The leaders have announced two 'framework agreements': the Security and Prosperity Partnership of North America, the SPP, and the Declaration of EU US 2008. These give them authority to address events that threaten economic stability, and which provide for economic competitiveness. The leaders have appointed councils, working groups and stakeholders, who work in global government principles and policies of security and prosperity.
I hope that investors heeded my past advice, where I recommended that one invest in gold at BullionVault.com and at GoldMoney.com and that one invest in the in GLD, SKF, RYWJX, and TBT, in a trust account and not a brokerage account.
I also recommended that one open a Forex currency trading account and go short EUR/JPY and short USD/JPY. The weekly chart of FXE:FXY shows the end of the age of investing long with 0.5% interest from the Bank of Japan; disinvestment is now getting underway, and fabulous wealth beyond which I am able to describe is coming to those who are short these two currency pairs in a forex account.
WIDGETIZE