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OK, I tried using technical analysis today and I think I have found a
free lunch. I mentioned last time we spoke that first the DEM broke then
CHF and soon JPY. Well my simple 13-week ROC between JPY/DEM and CHF/DEM
suggest swissie has some catching up to do.
OK, get this Norman, it fits with fundamentals! You see, everyone is
playing the devaluation game and the Swiss will not risk sending the
economy back into stagnation. Their GDP growth in the last six years
averaged 0%. The SNB have given all the signals that they want the franc
lower. This includes market intervention and pumping the banking system
with liquidity not to mention jawboning "we want the franc lower!". The
franc is a liitle slow to react becasue of the safe haven mirage that
capital will flow there to escape the soft euro. But it is a true
mirage, why put your money in Geneva when you can send it to the City or
NY and get 4-500 bps more for your money? Blah, blah, blah... right
Norm.
OK back to technicals, the 13-week ROC tells me JPY/CHF has 3.02% to
catch up to JPY/DEM. So sell the franc/buy yen and buy me lunch.
Tom.
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