Saturday, April 11, 2015

Waiting for Madoff @ 50:1 Leverage

DHL Risk: Overnight Delivery
Speculating in currencies is the fastest way to lose everything. DHL fast.
Maximum leverage in stocks is 2:1, in Forex it's 50:1. Yes, you read that right.

All investors are speculating in currencies now, whether they realize it or not. And the premise for being long dollar no longer exists. 

Overnight risk. Visualized:
Going back just a few months, traders betting on a continued Swiss Franc / Euro peg, obliterated themselves and almost took out their own broker (FXCM). Overnight.


Now, the current global melt-up rally is predicated upon a strong dollar, weak Euro/Yen. 

Meaning it's predicated upon a strong U.S. wreckovery, which Goldman just called off due to lack of an economy:


The premise for a dollar rally no longer exists. It was an Econo-dunce fabrication. Which is unfortunate, because correlation is not causation except when it is:

Euro (Inverted) with German DAX


Yen (Inverted) with Nikkei


Risk is binary