Thread: Theory of going against what the public does ...

We are in crisis time ... should we buy now?Any suggestion?Next, today's Reuters news ... New York - The Yen fell against the dollar and the euro after the Federal Reserve of the United States. UU. Inject liquidity into the banking system three times, reducing losses in the marketsstock market and calm the nerves of financial investors.The global central banks, including the European Central Bank and the Bank of Japan, added more than $ 301 billion to the financial system in the last 48 hours to stabilize credit markets."The central banks such as the FED and the ECB are injecting liquidity, which has done a lot to calm the markets," said Rafael Martorell, the main BNP Paribas operator in New York.This helped US actions recover from an early fall, which led the currency operators to sell the Yen that they had just acquired.Lately, the YEN has fallen when the markets of shares rise, since investors take advantage of the low interest of the YEN to finance purchases of more risky assets.When the shares fall, the YEN is strengthened because investors undo these operations and buy yen again.In the last New York operations, the dollar rose 0.3 % to 118.49 yen, more than 1 and above a minimum headdress previously in the session.The dollar also rose 0.2 % against the Swiss Franco, reaching 1,1970 francs.The euro rose 0.2 % against the dollar, to $ 1,3698, although below its historical maximum of $ 1,3860 reached last month.In front of Yen, the euro advanced 0.45 %, standing at 162.31 yen.** International credit concerns dominate the market ** The crisis, which began with losses in the subprime mortgage market in the US, has caused a global flight to safer assets.The actions fell, the government bonds shot and the expectations of increases in interest rates by the central banks were moderated.On Friday, the FED injected $ 39 billion into the banking system through three operations, and claimed to be ready to provide more funds if necessary, marking the first support signal of the Central Bank from the attacks of September 11, 2001.Despite the actions of the Fed, two of the three main stock market indices of the USA. UU. They ended the day down.The Dow Jones industrial average fell 0.23 %, recovering something from minimums intradicted more than 2 % below the opening.Although the actions continued weak, the Yen failed to recover ground."Participants in the currency market are adjusting positions," said Samarjit Shankar, director of Global Strategy at Bank of New York Mellon."We are seeing some decoupling between the positions in shares and currencies when approaching the weekend."Despite the volatile movements of the day, Shankar anticipated more profits for Yen next week."If the actions remain under pressure, the YEN is likely to be strengthened due to greater risk aversion and concerns about liquidity," he added.On Friday, the federal fund rate rose up to 6 %, well above the objective of the Fed of 5.25 %, which led the Central Bank to inject temporary reserves into the banking system.Short -term interest rates in the euro zone and in the US.The problems in the credit market have led operators to anticipate a reduction of a quarter quarter in the Fed rates for next month.In addition, the chances of the ECB rise next month have fallen below 50 %, compared to 70 % probabilities at the beginning of the week.Meanwhile, the expectations that the Bank of Japan hardens its monetary policy this month have fallen to one in three, compared to the previous 75 %.

Buying in the middle of a crisis sounds like brave strategy, but do you know what you do?People who buy now because "it seems cheap" is usually the same who sells with losses when the market sinks a little more.If you are going to enter, make sure you have a plan, not just hope.In addition, it is not only the moment, but what you are buying.Why would you bet on something that is so unstable?Yen is falling, but what is only the beginning of something bigger?Do your homework before risking your money.

Reuters's news explains the context well, but remember that central banks do not always get what they are looking for.They inject liquidity, yes, but that does not mean that markets stop shaking.The yen is weak now, but the scale scale could be quickly recovered.In summary: if you want to buy, do it because you have solid foundations, not because it seems "the right time."The market punishes the impulsives, and this environment is full of traps for the offices.

The crisis can be an opportunity for some, but also a grave for many.Buy now is to play with fire, especially if you do not understand how the forces are moving behind the Yen and the dollar.I recommend that you follow the news flow, but do not make decisions based only on headlines.You need technical, historical data and an analysis that goes beyond emotions or panic of the moment.

There is always talk of "buying cheap in a crisis", but few mention that most lose money trying.Yen may seem attractive now, but its weakness is no accident.Carry trades and risk aversion are pressing it.If you decide to buy, keep in mind that you could be entering too soon.Many times, the initial falls are only the prelude to a major storm.Be sure to have a clear strategy and an output plan.

The Fed injects liquidity and the markets seem to calm down, but do not be fooled.This does not mean that the problems are solved.They are just buying time.If you decide to act now, you must be prepared for volatility.On the other hand, if you are a patient, you may find a better entrance point.Sometimes, the best thing you can do is observe and wait for the market to show clear recovery signals.

Buy now?Of course, if you want to play Russian roulette with your capital.The markets are tense, and the news of the Yen falling only shows that panic dominates.The risk is everywhere, from interest rates to the instability of central banks.If you insist, at least have a clear strategy.Set your limits and don't get carried away by emotion.In the long term, you could thank patience instead of impulsivity.

I understand that the temptation to buy in the midst of chaos is strong.Many fortunes have been built in times of crisis.But, be careful, there is also a long list of investors who have lost everything to hurry at times like this.The current market is not only complicated;It is on the verge of unpredictable.Patience can be your best ally right now, because entering too soon could be an expensive error.

Financial markets are like a boxing fight: you have to know when to attack and when to dodge.Now it looks like a time to dodge.The liquidity injections of the central banks are not a definitive solution, only a patch.That said, if you have experience, you could take advantage of short -term fluctuations.But if you are starting, my advice would be to stay out until the panorama is clearer.

Yen falling is a signal, but not necessarily that it is a good time to buy.Often, these falls attract investors looking for bargains, but without understanding the real risks.Have you analyzed how you could behave if the crisis intensifies?The key here is to have a well thought out plan.Do not buy just because others are selling.Be sure to understand how the market could move in the coming weeks before risking your money.