Trump Falls in Line

Trump, who rode to the White House on promises to fix healthcare, avoid foreign wars, embrace Russia, dis NATO, label China a currency manipulator, rebuild infrastructure, slash taxes and upend the Federal Reserve is well on his way to reverting to the same stance as nearly every other mainstream politician in recent memory.

Yesterday, he declared that the US dollar was too high. And, after criticizing Yellen for artificially depressing interest rates to aid the (then) incumbent, it turns out he’s a fan of them (and, her.) Could it be that with all those ex-Goldman bankers running around the White House, someone sat him down and explained that he, too, could benefit from low rates?

USDJPY dropped right to our next downside target a full week ahead of schedule, but not without a bit of theatrics. Tuesday’s drop through the yellow line of support at 110.15 yielded, as expected, a drop to the falling white channel bottom. What happened next speaks to the continuing manipulation of USDJPY which, in turn, manipulates equity prices. The initial breakout above the yellow TL busted a rapidly falling channel in eminis. From there, USDJPY bounced back and forth in a series of headfakes above the purple trend line and below the red in order to fine tune equities.The primary purpose, of course, was to delay hitting the SMA200 until after the close — so as to avoid the rapid selloff that would otherwise have occurred. Mission accomplished. The yellow arrows below indicate where downtrends were interrupted.