There is a good chance that government bonds will soon be
the place...not to be. Matt told several times that charts
look like that US-interest rates have already bottomed or will
bottom soon. Fundamentally there is no doubt that with the money
printing all over the world inflation (and higher interest
rates) is a very serious issue.
So if not already short it makes certainly sense to look for a
short entry in government bonds.
Japan is probably the country with the highest risks with
government bonds. Bad economy, very bad demographic development
with too many old people, shrinking exports, and with an incredible
debt of over 200 % of the GDP, far higher than anyone else.
The government is determined to stimulate economy with
printing endless money. The goal is to create inflation of 2 or 3
%. This will be the kiss of death for japanes government bonds. No
way ther will be a solution for that.
At the moment the liquidity boost the markets in japan: Nikkei
is on fire, Yen is weakening, but there is still enough money
inflow that governments bonds don't fall much (unlike US
and Europe...).
I would appreciate a technical analysis of Japanese government
bonds. I only have a chart of JGB March Future. Maybe there are
better charts.... I would appreciate if someone could show a nice
chart of japanes government bonds.
To me it seems there is a triangle in the process which would
support even a new high. But mybe JGB will fail making new highs
and could there be shorting opportunity below the trendline?
In the long term there could be very large gains by shorting
JGB
so I'm not sure where JGB's fit into the picture. The big
difference, of course, is that there wasn't a full-scale
devaluation push on the Yen last time. Abe may feel the Yen has
gone far enough, but he won't be able to jawbone it back to
strength without also reversing the ramp in policies that got this
trade really going since November. JGB's should be the things
crashing over the coming years, but the ETF's to play that look way
too thin. If anyone has a good way to play rising JGB rates, please
share. Other than that, short Yen against almost anything should be
a good trade maybe for a decade or more.
Japanese Government Bond
Posted by zwyss on 9th of Feb 2013 at 05:13 am
There is a good chance that government bonds will soon be the place...not to be. Matt told several times that charts look like that US-interest rates have already bottomed or will bottom soon. Fundamentally there is no doubt that with the money printing all over the world inflation (and higher interest rates) is a very serious issue.
So if not already short it makes certainly sense to look for a short entry in government bonds.
Japan is probably the country with the highest risks with government bonds. Bad economy, very bad demographic development with too many old people, shrinking exports, and with an incredible debt of over 200 % of the GDP, far higher than anyone else.
The government is determined to stimulate economy with printing endless money. The goal is to create inflation of 2 or 3 %. This will be the kiss of death for japanes government bonds. No way ther will be a solution for that.
At the moment the liquidity boost the markets in japan: Nikkei is on fire, Yen is weakening, but there is still enough money inflow that governments bonds don't fall much (unlike US and Europe...).
I would appreciate a technical analysis of Japanese government bonds. I only have a chart of JGB March Future. Maybe there are better charts.... I would appreciate if someone could show a nice chart of japanes government bonds.
To me it seems there is a triangle in the process which would support even a new high. But mybe JGB will fail making new highs and could there be shorting opportunity below the trendline?
In the long term there could be very large gains by shorting JGB
Opinions very much appreciated.
Thanks
This looks pretty scary for longs.
Posted by cubby on 9th of Feb 2013 at 06:53 pm
Instead of Jap.-bonds, one may be able to just short ES. The correlation is very strong.
chart looks good...but market makers
Posted by himsa on 9th of Feb 2013 at 11:56 pm
chart looks good...but market makers and the banks make shit happen if they dont want it go they will hold off
You're showing the Aussie-Yen carry trade vs SPX
Posted by a_l_ on 9th of Feb 2013 at 07:25 pm
so I'm not sure where JGB's fit into the picture. The big difference, of course, is that there wasn't a full-scale devaluation push on the Yen last time. Abe may feel the Yen has gone far enough, but he won't be able to jawbone it back to strength without also reversing the ramp in policies that got this trade really going since November. JGB's should be the things crashing over the coming years, but the ETF's to play that look way too thin. If anyone has a good way to play rising JGB rates, please share. Other than that, short Yen against almost anything should be a good trade maybe for a decade or more.
Yes. there are many other
Posted by cubby on 9th of Feb 2013 at 08:18 pm
Yes. there are many other currency pairs.
However, this one is most strongly and consistently correlated to ES.
I suppose the money for levitating ES is coming from somewhere.
The Fed is helping to be sure. But this recent surge is more than the Fed alone.