{+++} The bulls showed up today and tried to take back the hill. We still haven’t tagged new all time highs on the SPX yet, but we are getting close again.
I added two new ETF’s as long plays today: YCS (short Yen) and DXJ (long Nikkei stocks).
Not to be outdone by Bernanke, Japan is embarking on a one trillion dollar buyback of debt. Bottom line…the Yen is going way lower and their stock market is going way higher. Yes, the Yen has fallen lately, and the Nikkei has had a bit of a move already, but I think its probably just the second inning and much higher prices are in store. Remember what happened to our markets when Bernanke started with QE1. Many of the stocks in DXJ are Japanese exporters which will do especially well with a falling Yen.
Both are a little overbought, but this is a longer term hold and I think dips will be buyable.
Here is a monthly chart of the Nikkei. Are things great in Japan economically? No way. But re-inflation is all the rage.
The global printing presses are pumping right now, this will all end in disaster in a couple of years, but for now, just ride the wave.
See you guys in the morning.