This is going to be a relatively brief update as I’m still burning the candle on both ends in order to meet an internal deliverable. There are two major forex symbols I wanted you to look at today as they both are in the process of a regime change. Which effectively means that a long term inflection point has been breached which in turn leads to a new market phase with different dynamics.
The VIX closed at 9.17 yesterday and as the ES is pushing higher in early morning trading I am starting to wonder if we are getting close to breaking the old record of 8.89 which was registered on December 22, 1993. Which is probably the clickbait you’re finding plastered all over the financial MSM right now in eager anticipation of a new ‘record low’. Which however all by itself is relatively meaningless. Fortunately here at Evil Speculator we always pop open the hood and look at what’s really driving things – it’s time to crunch some numbers!
Alright, it’s time to talk about the ole’ greenback. Which, in case you haven’t been paying attention whilst increasing your odds of skin cancer at some overpriced beach resort, has been dropping rather precipitously since the beginning of the year. You may counter that a correction was long overdue since the Dollar has had a pretty good run over the past two years. And you would be technically correct – in relative terms compared with everything else the Dollar has been on a solid run since mid 2014. But in real purchasing power today’s Dollar is a whopping 27% weaker than when Will Smith’s big hit was hitting the charts in the summer of 2002.
We have a small cause for celebration today as this will officially be post #4000 here on Evil Speculator. Which incidentally was launched all the way back in early August of 2008 – almost exactly nine years ago. It was a time of wonder back then and electricity had just been invented a few months earlier. I still remember having to take an Uber horse buggy to the evil lair in the morning, on muddy unpaved roads seamed with beggars and packs of rabid wild dogs. Trading was done by telegraph in encrypted morse code and our favorite way of shorting commodity futures was by arson of a hapless local grain farmer. Those were the days! Quite a few of you regulars from back when are [...]