Always be skeptical and expect a reversal when the headlines become one-sided. The dollar should not be this weak nor the euro this strong. Trump is not the Agent of Chaos, he’s the recipient.
Scanning the headlines at Zerohedge just now I am becoming more convinced that we are approaching peak idiocy in the Europe Stable/U.S. Unstable narrative being pushed mercilessly by the media and the Deep State.
Now Zerohedge is, on a good day, apocalyptic in its rhetoric, but today is particularly bad given the multitude of things happening all at once.
Look at the sheer density of this. First there’s North Korea. But, the next article is a link to a blog saying it’s time to buy JAPAN?! What in the holy hell are we talking about?
Japan has many things going for it but the lion’s share of the world’s debt is not denominated in Yen. It’s in U.S. dollars. And if there’s going to be a war or an impeachment or a banking crisis, smart money is going to flow TO THE UNITED STATES, not away from it.
It certainly isn’t going to by Japanese Gov’t Bonds at negative yields. In fact, it’s continuing to do what I expected it to do, buy U.S. stocks (to the consternation of ZH’s editors), U.S. bonds and gold, which just broke above $1300 for the first time since Trump’s election.
The headlines promoting a stable Europe and the enormity of the pressure being heaped on President Trump is Gaslighting, folks. We’ve reached the point of Anxiety Porn and the Deep State is PornHub.
So, while I don’t think we’re done with the short dollar trade yet, especially since we do have that pesky debt ceiling fight on the horizon. But, I want to make you aware that when the world looks like its about to melt down, the other side of the trade will be the place to be.
The worse this gets, the more faces the Dollar Rally in 2018 will rip to shreds.