Friday, October 1, 2010

Bookkeeping: Restarting Powershares DB US Dollar Bullish (UUP)

Per the article a few hours ago I am going to begin a 2% beginner stake in Powershares DB US Dollar Bullish (UUP)... I think it has maybe 1-2% more downside left before it simply seems necessary to bounce for technical reasons.   This will NOT be a long term hold - just a trade and flip, and used as a market hedge.   I expect when the market (one day) sells off the dollar to be rallying as the inverse relationship has returned.   Therefore, much like volatility or long bonds it's a pseudo hedge (short) position in my book at this time.  Ironically the last time I was long the dollar maybe 6 months ago it was moving in the same direction as equities - but that was when the Fed was debating soon exiting its emergency measures (selling assets off balance sheet) rather than increasing emergency measures.

This is neither 'fast money' or something you will make 10% in overnight like Baidu - but if I can catch the turn within a percent or two and get some sheckles out of it during a downturn I'll consider it a success.  Plus it is patriotic to buy dollars... right Ben?  I'll add more when it can show some life... I would however not expect it to do much more than return to the 20 day moving average before falling out of bed since Bernanke has his bazooka aimed at it.

Long Powershares DB US Dollar Bullish in fund; no personal position


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