Long

Nikkei break out? - China's Japanification

Updated

The recent Nikkei rally is bringing it ever closer to that "magical" 30,000 level which it hasn't touched since the late '80s collapse.
IFF a breakout occurs, expect a collapse in all XYZ/JPY pairs - since, true to form, every equity/hedge fund in the world is expected to pile in.

Internal Chinese (export/import) numbers are showing a fair pick up in exports - post Covid - BUT a very anemic internal demand, with import numbers steadily surprising to the down-side (by a lot!). Simultaneously Japanese heavy industry is racking up some solid numbers lately, especially in regard to steel, automobile and electronic components.
All of this is fueled by an abating chip shortage, giving world wide car production a boost.

E.g. Watch the Nikkei price action and fully expect a blinding YEN rally should that 30,000 level get blown away!

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CNH/JPY

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The question remains wide open - price action dependent - ...;

... as to what happens in this crucial area between 28400-29500??
So far, the Nikkei eked out a single weekly close above 30 000, shortly after which it collapsed. This is a wait-and-see scenario which, however, bodes very strongly for the Yen argument.

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Nikkei / DAX

A 6%-7% differential gain (rise) here is backed into the cake, already. The real question remains: Just how much more?? ...
... which, one could argue, is an awful lot(!), considering that the German economy, especially German heavy industry is in full and irreversible capitulation, just as Japan is gaining it's geopolitical and thus, strategic importance, once again.

Trade active

... and by the looks of it ...

... a Nikkei 35 000 is not only possible but rather quite likely! LONG

Here it is, on the Daily;

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This is taking off, something fierce!

... as the Nikkei is banging on that 30,000 level, once again.

Forget the DAX, other than an excellent Short leg for this spread!

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Looks like it broke out :-)

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... and this is where "low maintenance" became "no maintenance" ;-)

Still loaded to the hilt - Long.

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This is now a little over halfway to it's target (which looks to be a geosynchronous Earth orbit! ;-)

I just hope ya'll loaded up on this (long) as recklessly as I did, from the get-go?!

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This is just breaking out ...

barely half a way to a minimum move. So, buckle your seatbelt and just ride this like a rented mule!
Japan is springing out of it's slumber with arms and related industry production up +43% YoY and inflation holding steady at 3%. (While Germany, now the laughing stock of 2/3 of the world, is sinking ever deeper into an irreversible decline, well on it's way back to the '70s. - The 1870s that is.) Japan, for the first time, is participating in the largest NATO air defense exercise in Germany and Eastern Europe. The German defense ministry announced that they will send 2 battle ships to the Sea of Japan, later on this year. They surely must jest! If history is any indication, that has got to be right up there with all the other suicidal ideas, every empire in decline mustered up as it's last grasp! (Like the Tzarist fleet, having sent 8 battle ships there in 1904-05 and after sailing 18,000 nautical miles all of them just to be sunk in a matter of hours. :-0 Whether it's Japan then or China in the future, they can absolutely annihilate anything floating virtually instantly, short of something that happens to sail under a US or a Japanese flag! (Japan's navy being the 2nd largest in the world, including the only long-range navy of size beside the US's!)

Trade closed: target reached

So far having already collected an obscene amount of coinage (+1132%;-) in a strait, "no maintenance move" ...

... it is time to start looking to scale back a bit here. (... dependent on how ridiculously over-loaded one may, or may not, have been ;-)
There is much more mileage left in here in the near future but for now it is starting to get a bit frothy. (A lot will depend on the Yen's near-term situation and potential geopolitical developments.)

Trade closed: target reached

On the 33rd anniversary (of these price levels) AND an exact hit on our initial Price Target ...

... just how many more clues did we need to start looking towards the exits here?! ... None!
This move is (likely) very far from over but for now, we have fully de-levered and finished scaling back out to just under 1/3 of our initial (insane!) Long position.
It's a wait-and see, for now.

Trade active

It's time ...

More than just to keep an eye on the proverbial exits, use them! - We're out.
FLAT, for now.

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So far, we bailed on our massive longs within 25 points of this current "top". (+1132% ;-)

However, I wouldn't read too much into this turn, just yet!
Without the Yen showing any sign of significant strength - especially vs. the USD - so far, this is just a consolidation in that 25% up-channel. Wait-and-see ...
If one is aching to be seriously short some equities then here is the DOG - I mean, the DAX;

Ride it like a rented mule! SHORT

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This spread however, remains a relentless LONG,

... probably for the balance of our natural life spans. (... especially now, that all European equities combined don't amount to the net value of all the public pissoirs, continued to be deployed there.)

Nemo_Confidat

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