Test of the bulls....

We need some action from the ever present bulls of this market. The counters already getting themselves ready for rebound;

The most recent 10 week down moves resulted in an average change of +1%, with 7 gains and 3 losses in the following week.

However, the ongoing June SALE in mortgage issues looks to continue, and in the steepning game the 2-10 spread has broken significant levels creating momentum even higher....

I remain short DAX and S&P, but been wrong before :)

BIS in its annual report reminds market of 1998 sell off in USDJPY - something I keep reminding myself of. "There is clearly something anomalous in the ongoing decline in the external value of the yen.. The underlying problem seems to be a too firm conviction on the part of the investors that the yen will not be allowed to strengthen in any significant way".

It is clear that most investors got firm believe this is going to go on forever, which could happen, but from risk management perspective, you have to watch downside in USDJPY.

I am off to Iceland to speak at conference and some facts finding. Back Wednesday.

Portfolio: Same oh, same oh.....bias: short stocks, curve + FI, short US dollars across the board, long CHF and JPY.

Good luck.

Steen