Ed Note: Below is a small excerpt from Mark Leibovit’s Daily VR Trader. Be sure to check out The VR Gold Letter which is published WEEKLY
Canadian TSE, TSE Venture and Canadian Dollar Commentary for our Canadian clients updated for Thursday, October 29.
TSE:
Across the board weakness, with a special emphasis on Energy and Materials, knocked the TSE for an oversized loss yesterday, ending the day at a two-month low. The TSE decline 248.21 or 2.25% to 10,805.33, a level it last saw on September 3.
Two days ago I wrote that cyclical weakness could carry the TSE down to 10,600. I mentioned that this would happen “in coming weeks,” but we’ve fallen 430 points in the two days since I wrote that.
Energy 133.28 -4.30
Financials 164.66 -0.76
Health Care 33.70 -0.60
Industrials 83.46 -2.21
Information Technology 26.33 -0.97
Metals & Mining 869.45 -59.28
Telecommunications 74.36 -0.59
Utilities 176.72 -1.76
TSE Venture:
Falling precious metal prices hit the Venture extra hard yesterday, closing with a loss of 43.05 or 3.30% at 1263.41.
Look for support at the 1231.25 low of October 2.
THE CANADIAN DOLLAR (using the FXC Exchange Traded Fund):
The rally in the US Dollar and steep declines in commodities, regardless of which currency you price them in, hit the Canadian currency hard yesterday. FXC fell 1.11 to 92.47.
With several Negative Volume Reversals ™ confirming a trading top in FXC beginning October 15 and the face we have broken below the 50 day moving average, we could be looking at a break into the high 80s. For the moment we have to be cautious until upside volume reappears and the current correction runs its course. Look to support at 91.00 from the September 25 low and then 89.75-89.91 from the August 17 and September 2 lows.
Globe and Mail reports now that Nouriel Roubini has dispensed with the current slump, it’s time to move on to the next global calamity. The New York University professor, nicknamed Dr. Doom for his famously grim but accurate prediction of the financial meltdown that flattened economies around the world, said Thursday the U.S. recession appears to be over. But he warned that a new asset bubble fuelled by rock-bottom interest rates and a falling U.S. dollar could trigger another financial disaster. “This asset bubble is totally inconsistent with a weaker recovery of economic and financial fundamentals,” Dr. Roubini told a conference in Cape Town, South Africa, by satellite, reported by Bloomberg News. “The risk is that we are planting the seeds of the next financial crisis.” The culprit: Investors around the world borrowing cheap U.S dollars and using them to snap up equities, corporate bonds, commodities and other assets, driving up prices far beyond what could be justified by economics.
Nouriel Roubini’s article:
Nouriel Roubini warns of bubble
Now that Nouriel Roubini has dispensed with the current slump, it’s time to move on to the next global calamity.
The New York University professor, nicknamed Dr. Doom for his famously grim but accurate prediction of the financial meltdown that flattened economies around the world, said Thursday the U.S. recession appears to be over. But he warned that a new asset bubble fuelled by rock-bottom interest rates and a falling U.S. dollar could trigger another financial disaster.
“This asset bubble is totally inconsistent with a weaker recovery of economic and financial fundamentals,” Dr. Roubini told a conference in Cape Town, South Africa, by satellite, reported by Bloomberg News.
“The risk is that we are planting the seeds of the next financial crisis.”
The culprit: Investors around the world borrowing cheap U.S dollars and using them to snap up equities, corporate bonds, commodities and other assets, driving up prices far beyond what could be justified by economic fundamentals or growth prospects.
….read more of Roubini’s articl HERE.
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