Home > Uncategorized > Brief Update: 2009/12/22: Santa Portfolio Manager Trumps the Carry Trade Crisis Cassandra’s

Brief Update: 2009/12/22: Santa Portfolio Manager Trumps the Carry Trade Crisis Cassandra’s

 ▪ That’s the only conclusion one can draw from the mutual strength in the equities and US dollar, not to mention the weakness of the bond markets, Gold and Crude Oil.  Either there has not been enough US dollar carry trade borrowing put into speculative equity positions to affect markets, or there is enough portfolio manager window dressing to fully offset it. Whatever one may think about equities’ prospects, even the obvious triggers for potential bad reactions do not weigh on the markets.

▪  That said, as we noted previous, any DJIA 10,500 area UP Break (actually more so on the order of its 10,580 rising ‘topping line’ this week into next)  is now well calibrated to the decision in March S&P 500 future, yet may still falter if Holiday volume is too light.  

▪  Due to the bond market’s extensive weakness, it is the one area requiring further comment as March T-note failure back below the 117-24/-16 area has now seen further erosion below the important interim low at 116-20 (the December contract low after it became front month back in late September.) That leaves the mid-115-00 level and more critical support into 115-00/114-16 as likely targets. And due to that slippage in the US long end, it is even more critical…

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