« FXCM’s adding new pairs! | Home | DailyFX Forex Radio – US Dollar Continues To Fade, Friday’s US Data Provides Major Event Risk »
Carry Trades and the Dow
By DailyFX Updates | August 23, 2007
Since everyone is saying that carry trades are moving in lockstep with the Dow, watching the movement of the US equity index could give us good clues as to whether the yen crosses will turn negative as well. Here is the latest Dow chart. Watch the green line (100-day SMA). If we have a close below there, we could see more substantial US equity market weakness, which could translate into carry trade weakness.
Tags: carry trading, currency trading, forex, forextrading
Topics: What To Look At In The Market | 2 Comments »
August 24th, 2007 at 11:08 am
i keep hearing that carry trades have to do with interest rate differentials. but if they move with the dow, then the differentials wouldn’t matter; all you would need is low interest rates in japan. so which is it?
August 24th, 2007 at 11:18 am
[...] either (which is almost as good). We talked about the carry yesterday, and it should continue to rebound as long as the Dow does well. The only major negative report that we have heard regarding financial institutions is [...]