RelaxRay Journal

and the flavour of the morning .. cad was poise for a break kept flirting with the neck and couldnt stay away too far.. it attacked the neck yesterday and gave a clean move.

oil was leading it imo, as it broke the decline neck then cad demand move swiftly, but nvm what happen, just move with the flow...
(news reported it as NAFTA... whatever...)

cad crosses is looking so yum..
oil d1

oil h4

oil h1



Regards

In my experience, battle plan and planning for battle is the most important part...

Rescue is the most frustrating part, and especially if it drags when wind do not come in favor and price just hangs there.

So.. note to self, plan strategies for move out well, get it written down with the tactics of the strategy and play it out with iron discipline and patience.
It is always about discipline and patience.

Good fortune everyone.
Many thanks and appreciation.

Ray.


Oh and never ever forget.
All warfare is based on deception, hold out bait to entice the enemy.

ok.. follow up on the trade, just a quick one before i stop my painting career....





taking profits can never go wrong, but taking it early and re-entering only for price to turn is a #&$@(*$#. Or even watching it run another 40-50% for the day is also a #@$@#$.
So at what point can we re-enter or at what point do we take? what does the data at hand suggest?

on m1

watch how she gains in strength previously, making hh hl ... and spiraling through the channels...

same thing on uj, usd them charts to time the overall movements.. maybe some follow through later on, we'll see..

reload or not let her show.. take them and run .. dont want to get caught with pants down.
(if it breaks lower, and stays, i will go 2 or 4(for this current context) , namely reload the first 2, but i will not stay in the battle for long. so at current, we encountered resistance am watching what will they do now.



till i update here again,
good fortune everyone!

damn, keep eating my words on not posting..

on EJ now, i was long eu, and short UJ right, EJ flat(held steady) - 3kingdom in tact.
now on EJ its moving down, Uj is selling too...

I might get some over here.. jpy str seem intact,

ok over and out

///
update


here is what i meant on 'easiest, safest route' some days, we get lucky.

seem to be a very good book for thinking and mental psychological game.
black box thinking - matthew syed

Haven't really visited here much, but many as a journal, it deserves an update or entry now and then..

Different angles at the window, shows different views.

I found participants, don't really actually look at the charts. for they already know it. Tape reading, they say its outdated or tool of the yester-year. However, it still seem dang current to me every day.
No one sits and look at the charts, it seems to be marketing tool, as with whatever buzz word there may be.
if we are looking at the price all day, it surely forms an image automatically in our mind, if it trades at 05 on Monday last week, and it moves to 30 this week. I sure as hell aint going to sell.
There is an insane amount of price stream from different institutions, at best, every one looks at bloomberg or reuters. but if they want to sell, or buy. they are acting on a piece of information deem current and worthy.
Chart show a nice history and foot prints of the market, sure, we can look at previous days level, but if we are in the markets, we always know them and the information is already printed somewhere. lets say, it traded between 10-20 yesterday, i surely going to buy if there is little selling intention and price move upwards of 20.
what is in question, is the amount of time spent in the market in a given trade. that is the real question.
time spent = exposure = risk.

its really a different game on the other side...

so the deal with the xxx/try. i think its my best trade to date.. and it gives me more confirmation to ignore ALL news and and trade the price, as news is pretty much old stale and already done.
the news, its dunk, its a waste. the chart is the only way to trade.

for eg, whatever news is selling about crisis. it wont happen. definitely not so easy. NEWS OVERSELLS ALWAYS. Because it is where the readership is.

In the real world, there is fix, settle, clearing and most importantly, positions get squared, buyers turn sellers, sellers turn buyers, etc.
+ the king/kings of the market, central banks. And what they have power is the ability to issue short term IOU/bonds etc, where it makes it very attractive to borrow/buy the currency short term because yields is what drives the market as it is MONEY, almost FREE money!

i know what i said about charts.. but this one few triggered some perimeters and could be a nice divergence trade moving forward into the quarter or a set up for 2019.

charts have indicated comm currencies that were first out of the line, to have weaken pass previous neck line and held under. illustrating the fact that the steam have already ran out for them, while the laggers, might move in the near/medium term. personally, i find it abit expensive to park them overnight now, so might do a day position if suits. just thought i leave this here and kick myself or thank myself in the coming months ahead.

cue-
keep the mind open, opportunities are every where. belief are mainly false. what is important is facts, actionable, probable facts.

rgds

https://www.bis.org/publ/mktc10.pdf

https://www.bis.org/review/r111013e.pdf

https://www.ft.com/content/45d3807a-...a-118c761d2745

interesting good quality reads..

and how does the jpy basket look after that? cleared !

Market liquidity is evolving into a rather diluted terrain. That is just sad.

But before the reason, I think it will be interesting for me to write on how the market operates and liquidity gets or is consume.

So in the market structure there is different tier banks, tier 1, 2, 3, 4 and so on and forth. please note that the classification here is via basel. In this case, tier 1 is the largest.
Other then the banks, there are real money, hedge funds, retail, ecn-dark pool etc etc.

All of who consume liquidity in their own needs and wants. For example, real money could be an insurance company needing to buy a large volume of currency asset and move that into the S&P, while a retail bank needs to net some ccy against another for hedging purposes. In the dark pool, it is what it suggest, where it is anonymous liquidity, some times or most times, it gets charged a premium moving in there, but as the business is so competitive, its not that bad any more.

Banks have the option in dealing in the primary markets, EBS, or through other mediums like voice brokers who would then push their order into the market, maybe through an FX aggregator(FXall/FSS/MarketFactory etc etc[I hear the counts are in the thousands] / ECNs. or they could any other provider that is available.

So why do I think the industry is almost fully automated and almost at the end for the old school participants and perhaps, very little room left for incoming participants..
firstly, voice brokers are almost extinct/retired/OBSOLETE. yes,there are still voice done with brokers,but for how long more? almost every desk is electronic now, which brings about the algo market making who consumes and decides if they are absorbing the order, or pushing it out in the matter of ticks. - way faster then any human can.
ruling and compliance - tougher rules and closer compliance make it difficult for participant to work in the market and create synchronize volatility .. which also led to volker rule and making banks client focus instead of money focus and pretty much killing most of the proprietary trading desk.
this point is not that valid as hedge fund saw a boom and increase.
markets are just becoming more and more unpredictable because it is becoming unstable due to the amount of algos and recycling of liquidity in the market. this makes it very difficult to segregated real flow from recycles.
take the above example, where the real money customer hits the tier 2 bank, which got the order and pushes it out to a 3 bank and at the same time an ECN dark pool. which happens to be routed back to the very tier 2 bank who is a LP in the darkpool who was pushing the order. and the algo thinking ok, i sold xxx and market gave xxy. there might be a move, and started quoting .1 more then the other market, and the darkpool senses that and different makers start acting on it in a split second, and maybe gets pick up by a tier 4 bank that goes WTF? and calls voice bro to deal it out and the voice pushes it through another dark pool .. and the same repeat. then a tier 1 saw that and comes in the market and quotes the opposite, with the algo going into different mode and softening it. and then it goes quiet for the rest of the session.
ps this is a market making example, where the order interacts with each other.

if its a proprietary trading desk, how is he going to make sense of this and make money when the ticks hes looking at is fake and not real. simple, he could arbitrage between aggregate and different ccy creating some noise of himself as well, picking market inefficiencies.


-- note to self, structure this better when i get time-- tired --

hmm.. thoughts for quarter...
insane.. already march, 3 mths have gone in this new year ! mental.

looks like gbp is pricing in something positive. EM esp skandies looking to shape year and unilateral yield


jpy still clueless and if g7 start to neutral and favour a hike with jpy only now moving at all, could provide good yield against higher yielding ccy - one thought to consider and hunt for alpha in year ahead for 1H --

steady the helm, read the waves, steady the speed, steady as she goes.

please, no goons and baboons with ego that thunder through waves. no grace, failure awaits.
of course.. right tool for right terrain .. as she sees fit

ok interested to look at a long gbp position now.. why?

negative brexit is priced

technically,
cable is at:
2018 yearly low at 1.25
2018 yearly high at 1.43
mid point at 1.34

weekly inversion head and shoulders retracement in progress, currently at about 30% of upward thrust
while, EURGBP have broke its soft monthly floor and 2018 low, and mutated topping motion still somewhat intact, which also leaves room that the gbp favored when compared to the EU, and possibility for a positive outcome increasing.

What is the hedge?
Should GBP weaken instead, i would sell the gbp against the oil based ccy, ie, nok or cad basing on increasing tension for an increasing oil demand and that price is working on a break towards the upside to maybe 65, leaving room for gains

longer horizon for a bullish gbp, i would favour gbp against a ccy that is pushed to move sooner then later, ie the rba or rbnz where the economy is seen at full cap and regional factors and internal economics prompt a rate cut in the future ahead, given that the 2 central banks have already neutral for a long time, it is increasing likely for that to happen. technically, the monthly sellers as previously mention have also remained in frame for a bearish outlook.

but we'll see....

still favour the em and skandies for the yield.

rgds


ps. patience always. the ability to wait for a chance, not rushing in, but moving piece by piece assessing as it changes.
what happens if it is not in line? or late?
the ability to wait does not mean or refer to being slow. being patient is by no means slow. it is simply waiting for the chance to appear, and seizing it. if the chance appears, can it not be in line or late? yes, of course - murphys law. just that we can get out with minimal damage sustained. nothing is perfect, that is why, evolution exist.... the constant state of adapting to the needs of time.
execute with precision and patience!

update on the current play,
intra week wise on the H4, it looks to have broken the neck on the gbp front. a completed pattern would take it passed the 60% retracement which signals a weak thrust upward.
I am now shifting my stance to defensive hedge on the GBPCAD while looking for chance to go long on the GBP if there is a chance. Likely scenario would be on the EURGBP front where eur is seemingly weaker then the GBP with space to run. Or just abandon the gbp for now altogether.

Or selling the euro to the gap at 1.07 ..

very strong sell on the euro