Enter The Golden Age Of Currency Trading

Enter The Golden Age Of Currency Trading

From seekingalpha.com

Markets are like ocean liners, they take a long time and a lot of room to turn around. But when they do, they are steadfast in holding the course of that new direction. The current long-term bottom the U.S. Dollar has sewn in over the last several years, Figure 1, reminds me of the last time the currency markets reversed on such a large scale, in 2002. (click to enlarge)Figure 1. Monthly Dollar Index Chart In 2000 and 2001 every analyst on Wall Street was sure the U.S. Dollar was going to top out and reverse lower and that the currencies and gold would soar. Similarly most house analysts today feel strongly that the ... (full story)

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#1
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Jun 4, 2014 6:30pm Jun 4, 2014 6:30pm

ElectroGypsy
| Joined Aug 2012 | Status: Member?! | 14 Comments

The lesson the article alludes to is key: sometimes it's better to be late than early. The same will likely be true with the ECB report tomorrow.

I'm a dog chasing cars.

#2
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Jun 4, 2014 6:30pm Jun 4, 2014 6:30pm

The Fool
Joined Apr 2009 | Status: Live and learn. | 1841 Comments

Yep, just go long the USD and watch the profits pile up for years and years.

"If The Fool persists in his Folly he will become wise." - William Blake

#3
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Jun 4, 2014 6:34pm Jun 4, 2014 6:34pm

Trout
| Commercial User | Joined Oct 2007 | 688 Comments

profits only pile up when one knows how to trade

#4
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Jun 4, 2014 6:44pm Jun 4, 2014 6:44pm

Rtm
Joined Jan 2011 | Status: dump and pump | 913 Comments

The medium term sentiment has definitely changed and finally all that good US data is doing something after being effected by 'bad weather' for so long. However is it REALLY a long term indicator for bullish USD? Hardly think so. No evidence here technical wise or fundamental wise. Not until after this week is over anyways. Just a suggestion if you are are so bullish about good USA then just buy the SP500 and leave it.

All posts are my personal opinion

#5
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Jun 4, 2014 6:49pm Jun 4, 2014 6:49pm

hayseed
Joined Nov 2006 | Status: Trader | 316 Comments

hey jay..... 2 thumbs up...... best article i've read in quite awhile.....

i truly believe you are correct..... and it would be sad for us not to take full advantage.....

it will not be an overnight or single currency deal..... more like stepping stones from one currency to the next, as their economies improve which push up rates......

we are at the latest golden age's door...... moves in the 1000's of pips range will be over the next few years......

the stage is set.....h

to trade and code, keep both simple... no call to impress....h

#6
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Jun 4, 2014 6:49pm Jun 4, 2014 6:49pm

Trader#FA98
| Status: Unregistered Trader

Quoting Rtm

Disliked

The medium term sentiment has definitely changed and finally all that good US data is doing something after being effected by 'bad weather' for so long. However is it REALLY a long term indicator for bullish USD? Hardly think so. No evidence here technical wise or fundamental wise. Not until after this week is over anyways. Just a suggestion if you are are so bullish about good USA then just buy the SP500 and leave it.

Ignored

Um, I think you missed that part where a strong USD and rising yields may actually be detrimental to equities performance...

#7
Quote
Jun 4, 2014 6:49pm Jun 4, 2014 6:49pm

The Fool
Joined Apr 2009 | Status: Live and learn. | 1841 Comments

Quoting Trout

Disliked

profits only pile up when one knows how to trade

Ignored

Hey, I made the cut - wink!

"If The Fool persists in his Folly he will become wise." - William Blake

#8
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Jun 4, 2014 6:50pm Jun 4, 2014 6:50pm

Trader#FA98
| Status: Unregistered Trader

Agree with the article RE: USD bottoming out.
However, as always timing is everything.
Don't get burnt...

#9
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Jun 4, 2014 7:10pm Jun 4, 2014 7:10pm

Trader#FA7D
| Status: Unregistered Trader

Being early result uncertain. It may end well. Being late result guaranteed. It will end bad. Both lessons are learned the hard way as anything related to trading.

#10
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Jun 4, 2014 7:29pm Jun 4, 2014 7:29pm

M.A.C.Doug
Joined Jul 2007 | Status: Trader | 70 Comments

Well, Im a scalper, so all I know is since the ECB signalled there intention to aggresively loosen, Im Buying USD with Euros. After the numbers come in this week who knows. Its a gutsy long term call Trout and I respect that. With most analyst having an each way bet without commiting to any direction, its refreshing to see someone taking a risk with their reputation. One question though, If USD and interest rates rise, how will the US service the interest on its 17 trillion debt? Maybe a true golden age will arise and the U.S will no longer need defense spending, cause that would be the size of the interest bill if rates return to there historical average. I hope your right Jay and U.S growth dwarfs the debt, wouldnt that be fantastic?

BTC Return This Year: na

#11
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Jun 4, 2014 7:45pm Jun 4, 2014 7:45pm

Trout
| Commercial User | Joined Oct 2007 | 688 Comments

Hi RTM,
I penned my thoughts on the S&P 500 a couple of years back. See: http://www.forexfactory.com/news.php?do=news&id=371299

#12
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Jun 4, 2014 7:47pm Jun 4, 2014 7:47pm

Trout
| Commercial User | Joined Oct 2007 | 688 Comments

Thanks for contributing ElectroGypsy

I'm w/ you Hayseed!

#13
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Jun 4, 2014 7:49pm Jun 4, 2014 7:49pm

Trader#FA98
| Status: Unregistered Trader

Quoting M.A.C.Doug

Disliked

If USD and interest rates rise, how will the US service the interest on its 17 trillion debt?

Ignored

And there you've hit the nail on the head - one of the main reasons for "lower for longer" rates is exactly that if rates were to rise too fast, the US may become at actual risk of defaulting...

#14
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Jun 4, 2014 10:49pm Jun 4, 2014 10:49pm

pippiphooray
| Joined Jul 2008 | Status: Trader | 324 Comments

early = wrong

Just saying.

#15
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Jun 5, 2014 6:11am Jun 5, 2014 6:11am

SaiLyfee
Joined Nov 2013 | Status: Trading Chaos | 14 Comments

Don't buy into this shit..USD$ will collapse.

#16
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Jun 5, 2014 6:14am Jun 5, 2014 6:14am

upasna
| Joined May 2011 | Status: Trader | 805 Comments

Quoting SaiLyfee

Disliked

Don't buy into this shit..USD$ will collapse.

Ignored

Gold will up massively .. cross 1300

#17
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Jun 5, 2014 7:44am Jun 5, 2014 7:44am

Boy Wonder
| Joined Feb 2012 | Status: Trader | 175 Comments

Given its content the article should probably have been titled "The Golden Age of the Dollar"

I have no clue what I'm talking about.

#18
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Jun 5, 2014 9:23am Jun 5, 2014 9:23am

Trout
| Commercial User | Joined Oct 2007 | 688 Comments

Hi Boy Wonder,

The Golden Age of Currency Trading is apropos...USDCHF will benefit, and a sustained move lower for EURUSD will be easier to trade for most. Pros always appreciate a bull though however -- great fortunes are made buying dips in sustained moves not selling rallies in violent but short-term corrections. The bull camp is for optimists. And there is always DX futures where the spread is always one tick.

#19
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Jun 5, 2014 9:24am Jun 5, 2014 9:24am

Trout
| Commercial User | Joined Oct 2007 | 688 Comments

Hi Pippiphooray,
Early is just fine if investing.

#20
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Jun 5, 2014 9:55am Jun 5, 2014 9:55am

Trout
| Commercial User | Joined Oct 2007 | 688 Comments

Hi MACDoug,
Rates will go up very slooowly...and don't forget the G gets a piece of all that oil flowing out of the Bakken, not to mention the long-term peace dividend it affords...

#21
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Edited 3:08pm Jun 5, 2014 10:00am | Edited 3:08pm

pippiphooray
| Joined Jul 2008 | Status: Trader | 324 Comments

Quoting Trout

Disliked

Hi Pippiphooray,
Early is just fine if investing.

Ignored

I have always made the point that it doesn't matter if a trader is sitting on the bid waiting to be hit, or reaches across to lift the offer, either case they must be "wrong" for a short bit. Simply put, there is heat to be dealt with on all positions. If one is too early, and too wrong, they get stopped out. ;-)

Still a good article though.

Cheers

#22
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Jun 5, 2014 10:12am Jun 5, 2014 10:12am

Fermy17
| Joined May 2012 | Status: Trader | 59 Comments

currency war, economic war, strong and weak currency war. referee is central bank

#23
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Jun 5, 2014 2:07pm Jun 5, 2014 2:07pm

Tradethepips
| Joined Mar 2008 | Status: Trader | 39 Comments

Trout, great article, thanks!
Let's paint this scenario, if, if a currency war would be under cooking between central banks to made their exports more affordable among other benefits, which CB would win that war? I guess the FED has the biggest wallet/printing machine of them.
I have learnt that looking for long term direction is the correct way to make profits big time and staying alive in this game, but for sure, if a currency war starts, or has atarted already, what we would see for sure is a lot of volatility not to mention constant contradiction of words between CBs to move the markets. Well, there would be great opportunities there for us too.

Why such a rigid stance? To learn is the funniest process in live...

#24
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Jun 5, 2014 8:20pm Jun 5, 2014 8:20pm

Trout
| Commercial User | Joined Oct 2007 | 688 Comments

we have a lower low in on the euro on the daily chart -- higher high in DX and USDCHF -- but now we have to see if le euro puts in a lower high -- higher low for dx and usdchf...stay tuned...

#25
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Jun 7, 2014 4:50am Jun 7, 2014 4:50am

SaiLyfee
Joined Nov 2013 | Status: Trading Chaos | 14 Comments

Quoting upasna

Disliked

Gold will up massively .. cross 1300

Ignored

You know it, 2000 is just around the corner for Gold. Give it a couple years, tops.

#26
Quote
Dec 18, 2014 11:08am Dec 18, 2014 11:08am

Trout
| Commercial User | Joined Oct 2007 | 688 Comments

Quoting The Fool

Disliked

Yep, just go long the USD and watch the profits pile up for years and years.

Ignored

Yes indeed, Mr Fool. Happy New Year

Story Stats

Posted: Jun 4, 2014 6:17pm
Submitted by:
Trout

Category: Technical Analysis

Comments: 26 / Views: 7,766