My last post was that I was back and ready to trade – and I thought that to be true. However, Mother Nature had other plans for me. And you know that it is not nice to fool around with Mother Nature.

Living in Texas is always interesting, especially in the springtime when the storms come through. This spring was to be one to remember for us. The first one to get our attention hit just about our bedtime, at around 10:30 PM. It did not last long, but was one of the most intense hail storms I have every witnessed – and I have seen quite a few.  The stones were mostly in the gold ball size range – maybe a few just a bit larger. But it was the volume than astounded me. I love watching storms, so Linda and I were standing just outside our back door facing a large deck when the hail started. There were a couple of minutes with only a few, mostly pea size stones and suddenly the deluge hit. Within thirty seconds our deck was covered with hail stones in the gold ball size range – in some areas the cover was several stones deep.

The damage is our area was great. Virtually every house in our subdivision will need a new roof – including ours. We had a lot of patio covers, barbecue area covers and walkways that were covered with a plastic corrugated material called Suntuf. The reason I used “had” and “were” in the description should be obvious – all my outdoor covers were destroyed – including a cedar lattice cover over my front entrance.

And to ice the cake, our car was sitting in the driveway – my garage is used for many things – unfortunately, parking a car inside is not one of them.

Okay, this post does not have anything to do with FOREX – but it does have to do with currency and trading. Our deductible, on our homeowners insurance is large – really large. So I have been very busy doing a lot of work that I would have liked to have a contractor do, but needed to try to cover as much of my deductible as possible. So I have been trading time for dollars and dollars for services.

Yeah, I know I could probably have made more money if I had just kept trading. But that is not the way I was raised. Penny wise and dollar foolish it might have been, but I just couldn’t sit around and not try to do as much work as possible.

So I missed some very good trades in the FOREX markets. However, there will always be another opportunity. I just noticed that the Japanese yen closed down sharply against the US dollar. The USDJPY is one of my favorite pairs to trade especially when there is an extreme move such as this past week. The dollar is heading in a bad direction, and oblivion is on the horizon – but the Yen is most likely to get there first. Currency traders are a strange group. They still see the yen as a safe haven currency – and I guess it is – at least until it isn’t.

If you look at the numbers, as bad as the US dollar looks down the road, the yen looks even worse. Their debt, continuing deficit, and demographics are a building financial Tsunami that is going to be unavoidable. They are more than twice as far down the debt-hole as we are. But there is one difference – their debt is mostly held within Japan – ours on the other hand is widely distributed around the world.

There are a lot of countries that will be hurt badly when the US dollar becomes worthless so there will be a lot of reluctance to pull the lever and flush in down the toilet – not the same with Japan. They can bankrupt the yen at any time – then issue a new yen and it mostly affects only them. What this means to us FOREX traders is that the yen will almost surely roll over and die before the dollar.

But we don’t know when all this is going to happen – only that it will. When an entity accumulates more debt than it can ever pay off, it is only a matter of time before it becomes bankrupt. In the meantime, we FOREX traders can make a lot of money by being in the right currency at the right time.

If the weatherman will just get off my back, I will be back at work at my TradeStation very soon!

In the meantime, watch for the USDJPY to make a substantial bounce once the markets wake up and realize that as bad as the dollar is the yen is even worse.

Good luck in your trading.





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