This 4-day USD/JPY consolidation has morphed from a 3-wave correction up to 115.50, into a 4-wave triangle that should remain below 114.50.

While the Reserve Bank of New Zealand left rates steady on October 24 at a record high of 8.25 percent, as expected, the accompanying policy statement issued by RBNZ Governor Alan Bollard remained slightly hawkish.

When trouble comes, typically, the middle classes are the ones who suffer. They have something to lose, but not enough. Market crashes, deflation, defaults and currency depreciations hurt the middle classes, too, reducing incomes, smashing nest eggs, and generally making almost everyone poorer.

The US dollar barely missed hitting record lows against the Euro today and traded down across the majors as Durable Goods Orders were released at a much weaker-than-expected -1.7 percent.

The potential impact of Japanese economic data on the forex and equity markets is questionable, as USD/JPY and the Nikkei 225 have been driven more by risk aversion trends lately. However, if the data proves to be surprising, the news could shake carry trades and Japan’s stock market up.

Investor sentiment seems to be on the rebound, but signs that the credit crunch has merely gone into hibernation include the big hit to earnings reported by major US banks, the existence of SIVs in money market funds, and the substantial number of mortgages that may fall into default in the near future.

Price Headley looks at the beliefs that separate winning traders from the rest of the masses.

Todd Gordon is looking for the equity markets to move higher as confirmation that USD/JPY Wave 4 will prove to be more complex.

Americans might have to get used to it. Instead of giving advice to other countries, they may have to take some. There are bound to be plenty of economists in other countries who will want to offer it.

Fed fund futures now price in an 86 percent chance of a 25 basis point cut on October 31 and are also starting to price in a 14 percent chance of a 50 basis point cut as it becomes clear just how dire the housing situation has become, especially in regards to its detrimental effects on the US economy.