FXP 2nd position repurchase

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FXP went another $1.52 higher before dropping over 20% during the subsequent three weeks. Unfortunately we didn't repurchase at that time, as it then rallied over 70% in a month!

Then it dropped 50% in five weeks, which not only clearly illustrates the big and fast profit AND loss potential in levered instruments but brings us to today.

The fundamental and logical reasons to be bearish China are not only intact but mounting. The technical basis for further shorting is at best dubious at present, but such is the case always at inflection points.

We may or may not be at such an inflection point now, however in any case we're repurchasing that 2nd effective China short positon represented by FXP which closed today at $26.07 That is roughly $1.50 above its all-time low hit in late April of this year. A slightly higher low was also hit last November, in early April, and in late May, so as a technical support level the $25 area is very well-defined and a significant break below that area would perhaps cause us to become neutral for awhile pending a better technical setup in the future. Time will tell.




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