TideTrader

Fundamental investor💰

[TideTrader @TideTrader_]

I’ve made the decision to exit my positions and sit in cash while I watch how the Yen Carry Trade plays out. Not sure why this isn’t being talked about more but here’s my breakdown:

1. Japan just called a snap election for Feb 8
New PM Sanae Takaichi wants a big win so she can go full throttle on tax cuts + massive government spending.

2. Polls look really good for her party right now with most people expecting her to win comfortably (maybe even a landslide)

3. Big win = big spending + huge new borrowing
Japan already has insane debt levels. More borrowing = way more Japanese government bonds hitting the market.

4. Investors are already saying “no thanks” at current yields
Last 10-year JGB auction was weak
10y yield just hit 2.26% (highest since 1999)
30y and 40y yields are ripping even harder

5. That’s really bad news for the classic yen carry trade
Cheap yen borrow -> buy US stocks / Think heavy tech related companies -> repeat
When JGB yields shoot up fast, the math stops working.
Borrowing isn’t cheap anymore + yen can start strengthening.

6. When carry trades unwind you get:
people selling US stocks / global risk assets to buy yen back
downward pressure on equities (especially growth/tech)
choppy / ugly moves in many markets

We saw a taste of this in Aug 2024.
This time the long-end yield move is actually bigger in some ways.

Bottom line:
If Takaichi wins big on Sunday night then markets expect even more fiscal juice. In turn there is more bond supply pressure -> higher yields -> carry trade stress -> not great for US stocks in the short/medium term.

Not saying it’s guaranteed pure selloff, but this is one of the bigger things actually worth watching right now.

Election result + next few bond auctions will tell us a lot.

Japan 10 year:

[TideTrader @TideTrader_]

@Mr_Derivatives Doomberg is so back, missed your pessimistic takes!

[TideTrader @TideTrader_]

@TrendSpider And what about now

[TideTrader @TideTrader_]

@MidwestHedgie Serenity does it every day

[TideTrader @TideTrader_]

Just want to point out here that this in no way shape or form impacts $PL or $RKLB’s ability to launch rockets or satellites. I don’t know who needs to hear that, but there’s no reason to panic sell your shares.

[Wall St Engine @wallstengine]

BLUE ORIGIN LAUNCHPAD DAMAGED IN ROCKET EXPLOSION MAY NOT BE RESTORED UNTIL 2028, NASA’S ISAACMAN SAYS - CNBC

[TideTrader @TideTrader_]

@amitisinvesting Serenity consistently pumps stocks

[TideTrader @TideTrader_]

@Brownmoose Serenity literally pumps those types of stocks all the time

[TideTrader @TideTrader_]

@Mr_Derivatives But then I’d miss all your doomposting!!

[TideTrader @TideTrader_]

@StockSavvyShay Why would anyone want this?

[TideTrader @TideTrader_]

@Mr_Derivatives You short it Mr Doom?

[TideTrader @TideTrader_]

@Mr_Derivatives DOOOOMBERRRRRGGGGG

[TideTrader @TideTrader_]

@Mr_Derivatives Then you wouldn’t have been able to doompost and engagement farm!!

[TideTrader @TideTrader_]

@Mr_Derivatives Farming for engagement like you’re not well aware of what happened. Alright doomberg

[TideTrader @TideTrader_]

@Mr_Derivatives Doomerberg back it again 🔥

[TideTrader @TideTrader_]

@TifosiJoe31 You cannot and will not ever convince me to put money in crypto

[TideTrader @TideTrader_]

@TifosiJoe31 @MerlijnTrader Why would anyone in their right mind invest in crypto? Also you can put more money in a HYS account with 0 risk / 4.5% interest and get better returns.

[TideTrader @TideTrader_]

@PolymarketMoney In November it hit $250+, you’re not real

[TideTrader @TideTrader_]

Seeing a lot of people hold bad stocks bc of their “thesis”. It’s tough to not get married to a stock, (did it with $ONDS for a short time), but in the long run of staying a successful trader you gotta know when to cut a play. Just bc your thesis tells you one thing, it doesn’t change a CEO overpromising / under delivering ($TE & $EOSE) or insiders selling most of their shares and not buying when price is “cheap” ($HIMS). Every trade should be a learning opportunity to improve your skillset.

[TideTrader @TideTrader_]

@WatcherGuru And now?? These type of tweets are useless. Delete them.

[TideTrader @TideTrader_]

@RemoteNavigator You seem adamant to dunk on things a bit too much. The sell off was driven by misunderstanding of their recent update to an existing offering. And here we are today watching it rip.