Will Global Unrest Impact US Market?
No surprise today as the Dow continued sideways on mixed housing data, closing marginally higher by 13 points. As I mentioned in my last post and in my email to paid subscribers, the market is going to be largely sideways or even slightly negative for the rest of the week leading up to this Friday's Quadruple Witching so we should not expect explosive action. However, it is still a great time to be buying on any weaknesses.
What about all the unrest in the middle east and in Asia? Surely that would affect the US market?
Yes, they would but in a GOOD way!
Surprising but true, the US economy has everything to gain from the current unrest, particularly in Asia. China and Japan owns a huge part of US debt and if they go to war, not only will capital be flowing towards the US since the euro zone is still very unstable, it will also depreciate those currencies and make it cheaper for US to repay it's debt to China and Japan! That is why the US market is still going so strongly despite all these unrest.
For now, the Dow remains in an all out bull trend.
What about all the unrest in the middle east and in Asia? Surely that would affect the US market?
Yes, they would but in a GOOD way!
Surprising but true, the US economy has everything to gain from the current unrest, particularly in Asia. China and Japan owns a huge part of US debt and if they go to war, not only will capital be flowing towards the US since the euro zone is still very unstable, it will also depreciate those currencies and make it cheaper for US to repay it's debt to China and Japan! That is why the US market is still going so strongly despite all these unrest.
For now, the Dow remains in an all out bull trend.
posted by Jason Ng at 7:05 PM
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