Nikkei vs Dow 2 year chart

As a follow up to yesterday's charts on the Nikkei and Dow I have another chart today showing both indexes plotted on the same 2 year chart. As you can see there has begun a divergence of the 2 Indexes. The Nikkei has been going steadily down of late as the Dow continues to rise. It is my strong belief that the Dow will turn down and join the Nikkei once again, as the 2 indexes do track each other very well. At this time their spread is greater than it has been over this 2 year period.

With the Dubai troubles over non payment of their loans, this could increase the magnitude of the reversal. It's a good time to be on the Short side of this market. The ETF, TZA, should increase, as should FAZ as both are Ultra Shorts. TZA is a Triple Short of the Russell Index and FAZ is an Ultra Short of Financials.

Note, the chart is on a Log scale.

UPDATE: Halliburton and effect of their move to Dubai on the U.S. Dollar and the economy

UPDATE on Halliburton post. First the post and then the story.

March 12, 2007
Halliburton is moving its Corporate headquarters to Dubai according to news reports yesterday. Maybe they read what I posted on March 9th on a piece about Alberto Gonzales and wanted to have an escape route from prosecution!

"When more oversight is done by this Congress, more revelations will be made from how Halliburton cheated us by not providing the services contracted, not by Millions of dollars, but by Billions. I will predict that when all the investigations are complete, many senior Halliburton officials will be charged with crimes and do jail time."

Update 3/13/07
So this is the update: Marketwatch says Halliburton Dubai move is a negative for the dollar. So not only have they cheated the American people by defrauding us, they will affect the economy negatively. Here's a brief quote, "With many of the company's subsidiaries located outside of the U.S., Halliburton is notorious for using tax havens and in Dubai, they will be paying next to zero in corporate taxes for the most part.". Now the Full Story.

Halliburton's Corporate Executives escape route to Dubai

Halliburton is moving its Corporate headquarters to Dubai according to news reports yesterday. Maybe they read waht I posted on March 9th on a piece about Alberto Gonzales and wanted to have an escape route from prosecution!

"When more oversight is done by this Congress, more revelations will be made from how Halliburton cheated us by not providing the services contracted, not by Millions of dollars, but by Billions. I will predict that when all the investigations are complete, many senior Halliburton officials will be charged with crimes and do jail time."