As I myself have said, ad nauseam, the moment one tries to elaborate on why caution should be paramount when it pertains to these “markets.” It is those very “markets” that seem to look over their shoulder and simultaneously flip-a-finger to anyone daring to question their ascending route. Today, once again, is no different.
As of this writing at approximately 2:00pm ET the “markets” have vaulted, once again, beyond the stratosphere and into black-sky territory once again. Clearly the catalyst for this must be something so news worthy that the mainstream financial/business media would be lit up, so brightly, it would make current holiday decorations jealous. Hint: I’ll save you the time, there isn’t any. And I mean just that – anything!
Did in the overnight Tax cuts pass, or a healthcare reform bill get banged out? How about a flying car? Surely there must have been a flying car in all of this, right? Nope, nope, and nope. Sorry. But there was one thing that should give anyone trying to pay attention pause, if their truly trying to do just that. And it is this. To wit:
Above is a chart representing both the cross rate of the $Dollar and Chinese Yuan (the first on left) and both the Hang Seng Futures (middle) as well as the Hang Sang normal hours (far right). All are represented via 1Hr intervals. See those spikes? Those “spikes” are the equivalent of what I’ve half jokingly described using the analogy from Star Wars® when the Death-Star destroyed Alderaan. e.g., “…as if million of voices cried out in terror, and were suddenly silenced.”
These are the types of moves that are deadly to those with any resting orders, especially short sellers. Whether it’s an orchestrated “hunt and destroy” algo-program, or just an HFT algo gone wild. Doesn’t matter. For what it portends, usually, is not good for those that only believe in the BTFD investment bromide.
As many will sit around the table this week with family and guests. One can imagine that the topic of “Look at that market, ain’t it great!” will come up. When it does, as one listens to the reasons of why, that will surely follow the hyperbole near verbatim that one hears strewn across the mainstream media. I offer up just this one tidbit extra to chew on…
China is not Vegas – and what happens there – gets heard, seen, and felt exponentially so, here. And quick.
Just like turkeys: money, when it’s scared – will run to whatever door it perceives as “safe.”
Whether it’s actually safe or not. Just ask the turkey.
© 2017 Mark St.Cyr