Good morning, Slopers.
It’s very fashionable, I realize, to be madly in love with the US dollar and commit all kinds of atrocities against the Yen and Euro, but for the moment, I really think these latter two currencies have a chance at a turnaround.
Looking at the FXE (which is the ETF for the Euro – – kind of a poor man’s way of trading the forex), it has completed an island reversal. Going long the FXE with a stop at 102.69 seems like a pretty interesting low-risk trade.
I hope Slopers had a good Thanksgiving. It went relatively decent here, but I’m glad it’s over. Back to normal life for a little while (shortened trading session Friday notwithstanding).
One remark I’ve got to make is that I think the Japanese Yen’s collapse is overdone for now. Ever since the election, the US dollar has been rocketing against the Yen. I think this long-term trend will persist, but for now, I think there’s going to be some reversion to the mean. I’ll probably go ahead and take the plunge by going long the Yen on Friday. (I’m typing this on Thursday night)
There have been two “slow and steady” trades I’ve been writing at length about for my Slope Plus members – – being short precious metals miners and being short the Euro.
Well, you probably know by now that gold is doing what it does best – – – falling – – and the prospect I suggested that maybe it might get a TINY bounce before resuming its lame ways is out the window. I suspect GDX and GDXJ will continue blossoming (well, rotting) based upon their absolutely marvelous topping patterns, heading for prices lower than anyone dared think. As for poor old gold, it looks like the next $100 down has nothing blocking it………
Below is the symbol UUP, which has broken its series of lower highs and its threatening to create new multi-year highs. The Euro and Yen, naturally, have been getting trashed.