Even if SPX500 and GER30 go to new highs doesn't change my risk off choice. I don't invest anything but holding my money until weighted JPY reaches its purchase power value which means I'm holding a lot of JPY currency for safe haven until some HUGE risks happen. They will happen, soon...
Market is a mountains.
Even if DXY huge rising doesn't mean UJ is an up trending. As we know, we have a pair which USD is dividend by JPY. Infact, there are four directions in this pair and all that matters is the speed of the JPY's changing.
If you guys think about it then you will realize how deep EUR/JPY and NZD/JPY will drop.
Think it, again.
1, If DXY goes to new highs with USD rising rates, then we could reach target 0.5= NZD/USD.
2, If weighted JPY recovers its purchase power, then we could get target 96= USD/JPY.
3, ( NZD/USD) * ( USD/JPY) = NZD/JPY target 48.
4, Do your maths where we could get target EUR/JPY.
I can't update weighted JPY because it's confidential now.
NZDJPY is a risk/safe pair which is leading the global indexes. From monthly chart this pair is very early sign of the stocks markets crashing. The Kiwi is collapsing from GDT auction price and New Zealand GDP dropping, let's wait and see the YEN's weakness will save it or not. This time, BOJ could do nothing under Trump's shadow.
The food and the oil inflations correlated and DXY correlated too.
NZDJPY is an leading index of risk on, the Kiwi's weakening doesn't mean the weighted JPY can't help NZDJPY.
This Risk/Safe pair is leading the way of the indexes.
As I always told you guys in this publishing, Kiwi/Yen is an important risk/safe pair which is leading the way for global stock markets. If we have a black swan situation on Oct. which the Japan election result may shock the market like Brexit, with the dairy food inflation crashing and the GDP of New Zealand slipping, this pair is gonna crash...
The New Zealand inflation is still too low to fulfill the RBNZ's target because of the Kiwi followed the US dollar in the QE period or saying it's too strong comparing with the Oz...
The after Brexit risk on saved the channel lower edge, then the Trump election, then now what? I will watch this pair very closely.
This may be an first evidence of interests, inflations, stocks are gonna rise all together. A positive cycle should have begun in 2017.
Even if weighted Yen rising may help stocks doesn't mean Yen pair can't go down for a deep correction.
The western single market (SPX500, DAX30, FTSE100) shall rise with the interests. The China A shares market will drop in a condition interests at low, stupid as predicted before. The EEM market should be better than China, like 2010.
I'm not sure if Yellen's old team operators will tell the truth to a new team of the FRB. Central banks usually make markets collapsing during food inflation changing into the core one before they realize what is happening... Yes, I'm telling your guys they're more stupid than you can imagine...
But in the Australia, with recently Chinese students have been attacked by local people, the culture conflicts are undecided. (We don't trade this FYI)
From the Oz. and the Kiwi will have divergent money policies point of view. A culture movement in Australia may have a future of western people. Oz. may balance the Yen's moving.
We wish investors have good luck!
1, RBNZ hike to put it down, but for now, they're looking at China, wrongly.
2, Rumors about contaminated dairy, they did it many years ago...
Bear, very bear.
Traders need to watch stock market sectors carefully, some stocks will follow the food inflation soon...
We've seen food inflation dropped by 50% in China. The market will fight this out.
The futures market is designed for hedging to protect assets like agriculture, oil, etc, high lost risk products.
The futures market is NOT for speculative purpose, small traders are only participants.
Recently we've seen a lot of food price reduction in China. We've predicted that China's dairy stocks will fall sharply in the near future...
We've given the hedge strategy, as usual.
Be careful here, where those markets and prices have positive correlations with food, could crash simultaneously... ( Mao-tai top)