Thursday, November 9, 2017

Locus Of Crash

Japan has sent two wake up calls to U.S. gamblers in the past two months, both ignored...

The first wake up call was on August 28th when North Korea lobbed a missile over Hokkaido. The S&P was down 15 points at the open. That was the beginning of the global melt-up. Now, overnight was another 15 point gap, courtesy of the Nikkei running up to a new all time high and then reversing 1,000 points lower.

Here is where it gets interesting. Which other market had a key reversal overnight?

Rewind to mid October:

The vast majority of investors in Japan, South Korea, and China are extremely conservative with their investments and skeptical toward allocating capital to new asset classes. But, over the past three years, Bitcoin and cryptocurrencies have become mainstream assets in the Japanese market and consequently, Japan has evolved into the largest Bitcoin exchange market ahead of the US.

Currently the Japanese Bitcoin exchange market accounts for 61.23 percent of global Bitcoin trades, more than twice of the trading volume of the US market.

“Japanese people tend to be very conservative with their investments, but once they get triggered they go all in.”

What does this have to do with the rest of the world and U.S.?
"The sell-off in the Japanese equities caught the markets off-guard and triggered risk-off moods, lifting the safe-haven Yen against its American counterpart."

ZH: Foreigners Have Bought Record Amounts of Japanese Stocks

Bonus chart: