Why will the dollar rally?

[Moonshine]

Post your thoughts. I've been short the dollar since mid summer and I want to lever up. Someone tell me why this could potentially be a bad idea, I want to see if I'm missing anything.

[Jimbo]

If the employment numbers look great tomorrow the dollar will rally (even though I just heard Cramer say it is an irrelevant indicator).

Jimbo

Edited:

If jobs come in at closer to 100K than 85K the market should rally and I suspect the dollar will as well.

[Jimbo]

[ QUOTE ]
If jobs come in at closer to 100K than 85K the market should rally and I suspect the dollar will as well.


[/ QUOTE ]

That may have been the shortest rally in market history. [img]/images/graemlins/smile.gif[/img]

Jimbo

[CrushinFelt]

wtf... there has been so much good news.. this recession [censored] is gonna be a self-fulfilling prophecy. Even the real disposable income numbers were really, really good. As soon as I free up the cash from my mutual fund I'm jumping into AMD, DELL, and maybe a retail ETF (which has been getting hammered all year).

[NickNick]

How much higher do you think it will go?? 2.089 [img]/images/graemlins/confused.gif[/img]

[DcifrThs]

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How much higher do you think it will go?? 2.089 [img]/images/graemlins/confused.gif[/img]

[/ QUOTE ]

this is a very attractive short. i'd be long the USD/GBP now by about 40% of the max position.

if it moves north of 2.095 i'd build up to 50-60%

if it continues higher than 2.11 i'd push up further but i'd thing in the next 2 years the fair price of the USD/GBP would be in the 1.75-1.95 range based on interest rate/growth diffs and CA/KA considerations in addition to relative investments in securities.

Barron

[The once and future king]

[ QUOTE ]
wtf... there has been so much good news.. this recession [censored] is gonna be a self-fulfilling prophecy. Even the real disposable income numbers were really, really good. As soon as I free up the cash from my mutual fund I'm jumping into AMD, DELL, and maybe a retail ETF (which has been getting hammered all year).

[/ QUOTE ]

The bad news trumps the good news. Also the bad news is longer term.

[gonebroke2]

[ QUOTE ]
[ QUOTE ]
wtf... there has been so much good news.. this recession [censored] is gonna be a self-fulfilling prophecy. Even the real disposable income numbers were really, really good. As soon as I free up the cash from my mutual fund I'm jumping into AMD, DELL, and maybe a retail ETF (which has been getting hammered all year).

[/ QUOTE ]

The bad news trumps the good news. Also the bad news is longer term.

[/ QUOTE ]

what good news? 2/3 of americans already believe we are in a recession. the dollar has fallen off a cliff. oil is at all time highs and commodities are going bonkers. the housing market is in the 2nd or 3rd inning of the downswing. and most importantly, the over the counter derivatives that these financial institutions are hiding from investors are going to implode in their faces very soon. the financials are going to have 0 or negative earnings for the next several quarters. i believe they are going much lower and a handful will go bust or get bailed out. look what happened to the bond insurers of the CDOs (toxic waste):
http://finance.yahoo.com/q/bc?s=MBI&...;q=l&c=abk

the financials are infested with this toxic waste; not just domestically but internationally too. who knows when the next time bomb will explode.

[Moonshine]

[ QUOTE ]
[ QUOTE ]
If jobs come in at closer to 100K than 85K the market should rally and I suspect the dollar will as well.


[/ QUOTE ]

That may have been the shortest rally in market history. [img]/images/graemlins/smile.gif[/img]

Jimbo

[/ QUOTE ]

haha nice call on that one Jimbo

go CAD!

[CrushinFelt]

[ QUOTE ]
Post your thoughts. I've been short the dollar since mid summer and I want to lever up. Someone tell me why this could potentially be a bad idea, I want to see if I'm missing anything.

[/ QUOTE ]

Rate cuts are now less expected. Therefore the dollar, which had started to price in many rate cuts, may start to rally.