is it time to sell the nikkei 225 index & buy the japanese yen?
TRANSCRIPT
![Page 1: Is it time to Sell the Nikkei 225 Index & Buy The Japanese Yen?](https://reader035.vdocuments.net/reader035/viewer/2022081605/58f202481a28ab27418b45bf/html5/thumbnails/1.jpg)
Is It Time To Sell The Nikkei 225 Index And Buy The Japanese Yen?Nico Omer Jonckheere, 16th September 2015
![Page 2: Is it time to Sell the Nikkei 225 Index & Buy The Japanese Yen?](https://reader035.vdocuments.net/reader035/viewer/2022081605/58f202481a28ab27418b45bf/html5/thumbnails/2.jpg)
Japan’s Economic Disaster: Wages adjusted for inflation have sunk to the lowest since at least 1990!
![Page 3: Is it time to Sell the Nikkei 225 Index & Buy The Japanese Yen?](https://reader035.vdocuments.net/reader035/viewer/2022081605/58f202481a28ab27418b45bf/html5/thumbnails/3.jpg)
As a result, a record 62% of Japanese households described their livelihoods as “hard” last year in a survey on incomes.
![Page 4: Is it time to Sell the Nikkei 225 Index & Buy The Japanese Yen?](https://reader035.vdocuments.net/reader035/viewer/2022081605/58f202481a28ab27418b45bf/html5/thumbnails/4.jpg)
GDP for the world’s third largest economy fell by an annualized 1.2% in the three months ending in June.
![Page 5: Is it time to Sell the Nikkei 225 Index & Buy The Japanese Yen?](https://reader035.vdocuments.net/reader035/viewer/2022081605/58f202481a28ab27418b45bf/html5/thumbnails/5.jpg)
Recently both charts [the Yen and the Nikkei] have reversed direction which is the reason that it is timely to
examine what is happening in Japan.
![Page 6: Is it time to Sell the Nikkei 225 Index & Buy The Japanese Yen?](https://reader035.vdocuments.net/reader035/viewer/2022081605/58f202481a28ab27418b45bf/html5/thumbnails/6.jpg)
Having stepped in a stunning 76% of days to ensure the market closed green, it appears money is running out for the BoJ having spent 78% of its
allotment as of Sept. 7.
![Page 7: Is it time to Sell the Nikkei 225 Index & Buy The Japanese Yen?](https://reader035.vdocuments.net/reader035/viewer/2022081605/58f202481a28ab27418b45bf/html5/thumbnails/7.jpg)
Here are the MOST CROWDED TRADES currently:
![Page 8: Is it time to Sell the Nikkei 225 Index & Buy The Japanese Yen?](https://reader035.vdocuments.net/reader035/viewer/2022081605/58f202481a28ab27418b45bf/html5/thumbnails/8.jpg)
Therefore, this might be start of something very ugly.
![Page 9: Is it time to Sell the Nikkei 225 Index & Buy The Japanese Yen?](https://reader035.vdocuments.net/reader035/viewer/2022081605/58f202481a28ab27418b45bf/html5/thumbnails/9.jpg)
Foreigners dumped ¥1.43 trillion of Japanese equities in the 3 weeks through Aug. 28, which is the most for any three-week span on record:
![Page 10: Is it time to Sell the Nikkei 225 Index & Buy The Japanese Yen?](https://reader035.vdocuments.net/reader035/viewer/2022081605/58f202481a28ab27418b45bf/html5/thumbnails/10.jpg)
![Page 11: Is it time to Sell the Nikkei 225 Index & Buy The Japanese Yen?](https://reader035.vdocuments.net/reader035/viewer/2022081605/58f202481a28ab27418b45bf/html5/thumbnails/11.jpg)
The Nikkei 225 found at least near-term support in the region of 17,300 but a sustained move back above 19,000 will be required to signal a return to
demand dominance.
![Page 12: Is it time to Sell the Nikkei 225 Index & Buy The Japanese Yen?](https://reader035.vdocuments.net/reader035/viewer/2022081605/58f202481a28ab27418b45bf/html5/thumbnails/12.jpg)
![Page 13: Is it time to Sell the Nikkei 225 Index & Buy The Japanese Yen?](https://reader035.vdocuments.net/reader035/viewer/2022081605/58f202481a28ab27418b45bf/html5/thumbnails/13.jpg)
As you can see on the chart below, there has been major carry unwind:
![Page 14: Is it time to Sell the Nikkei 225 Index & Buy The Japanese Yen?](https://reader035.vdocuments.net/reader035/viewer/2022081605/58f202481a28ab27418b45bf/html5/thumbnails/14.jpg)
![Page 15: Is it time to Sell the Nikkei 225 Index & Buy The Japanese Yen?](https://reader035.vdocuments.net/reader035/viewer/2022081605/58f202481a28ab27418b45bf/html5/thumbnails/15.jpg)
![Page 16: Is it time to Sell the Nikkei 225 Index & Buy The Japanese Yen?](https://reader035.vdocuments.net/reader035/viewer/2022081605/58f202481a28ab27418b45bf/html5/thumbnails/16.jpg)
CONCLUSION ► A rate hike in the US and/or hawkish talk from the
Fed could trigger a risk averse reaction in markets.
► Talk of more easing from the BoJ could weigh on the yen, but it seems that until there is action, JPY sellers will wait.