GeoffreyTransom
Long

Nikkei - Deeply Oversold, CCI divergence

FX:JPN225   Nikkei 225 Index
71 3 0
For the moment, Nikkei is like a 5x leveraged bet over USDJPY             - for no good reason. USDJPY             is falling (i.e., Yen strengthening) despite
(1) no interest-arbitrge argument;
(2) Japan's trade position DETERIORATING;
(3) US and Japanese monetary authorities undertaking broadly similar jawboning, but US Fed actually 'tapering';
(4) capital outflows (foreign net selling of Japanese stocks).

So on any sensible theoretical basis - UIP, Robinson-Metzler-Bickerdyke or money-stock-growth conditions - JPY ought to be weakening.

My guess is that it's a hedge fund that's blowing up - having gone long USDJPY             and NK             at recent swing highs, they're now dumping NK             and USDJPY             . That is, the same story as happened in Crude at 147 (and again a year later, at $33, in the opposite direction)
Take off the second half of this position that was re-initiated 3 days ago.

Now you don't care if the first half goes to zero, because it effectively cost nothin'.
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With Nikkei being smashed today (because of Ukraine? Are you kidding me?), can re-initiate the half-position taken off a little over a week ago.
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Update: take half position off (now @ 14820).
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