Disliked{quote} As expected, GBPAUD long term trend is up from here: {image} And this is how my positions look so far, 4 pairs but no reds, all green {image} https://www.myfxbook.com/members/Nor...legacy/9364022Ignored
Trying my best.
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Disliked{quote} As expected, GBPAUD long term trend is up from here: {image} And this is how my positions look so far, 4 pairs but no reds, all green {image} https://www.myfxbook.com/members/Nor...legacy/9364022Ignored
Disliked{quote} Great analysis, thanks for sharing mate Will you please elaborate on what happened in 4 Nov. 2021 if you have time?Ignored
Disliked{quote} "Go straight to the source" The wisest advice ever. Simple but enlightening. When i took that advice and decided to learn the fundamentals, that was when my game has changed.Ignored
Green marked sentences are indicating already expected decisions, while the red underlined sentence is what surprised the markets and caused USD to appreciate for 3 consecutive days. It was the first time that the FED increased it's interest rate expectations since the start of the pandemic.
Now let's look at the highlights of the ECB February 2022 Meeting:
- Tapering PEPP in the first quarter of 2022.
- Ending asset purchases under the PEPP at the end of March 2022.
- Press Conference (Considerations for Monetary Policy): "President Lagarde's press conference seemed to suggest that the ECB has acknowledged that inflationary pressures are becoming more widespread. The bank now expects inflation to stay high for longer than previously expected and also sees risks to the outlook tilted to the upside. This is a significant shift. Risks to the economic outlook are still seen as broadly balanced but the tone of Lagarde's statement sounded a little more bullish on growth than in December."
Two different banks, similar hawkish change on the interest rate talks. Of course, FED was way more hawkish, they directly signalled rate hikes in 2023 back in the June meeting. Which is why the move lasted for 3 days.
ECB did not directly signal rate hikes in a specific time, but still they kept the door open for rate hikes which is a remarkable change from the ECB compared to it's previous stance on the rate hikes.
So my worst case scenario for Euro did happen unfortunately:
DislikedAs you guys know, we have BoE and ECB monetary policy meetings on 03/02/2022 Let's start with BoE. I expect BoE to hike the rates, like most of the analysts. I don't think a rate hike would be enough to cause a big bullish move on pound, since market already expects that rate hike so it's already priced in. Not hiking the rates though, would impact the Pound very bad, that would probably cause a sell-off like it happened back in 4 November, 2021. I am heavily long on the Pound, currently have GBPUSD and GBPAUD longs which is why i decided to balance...Ignored
QuoteDislikedComing to the ECB, both inflation and core inflation data that came out yesterday was higher than expected. Which may trigger a more hawkish ECB than we expect. So it's better to be careful.
DislikedThe massive move in Euro pairs after hawkish ECB sent me back to studying again. I am wondering what i underestimated and what could i do to save my EURGBP short positions. I am still keeping them open but it's a serious pullback in the downtrend and i should have avoided it in the first place. What we already know is it wasn't the monetary policy decisions that caused the Euro to appreciate. When we compare December and February reports there is no change on the monetary decision. It was the press conference that made the difference. What happened...Ignored
Disliked{quote} I'm grateful for you typing out your thoughts like this, mate. I see now why consensus vs actual is incredibly important for big meeting weeks. I learned a whole lot, filled up my notebook a little bit more too last week. It was a first-hand look at some intense PA, never seen crazy movements like that before What a fun time to learn how to trade.Ignored
DislikedQuestion, if you gentlemen have the time Is it safe to say at this point that FED, ECB, and BOE are all hawkish at the moment? And that what I should be paying attention to right now is how soon these central banks actually raise their rates?Ignored
Disliked{quote} Yes i definitely agree i think it is the best time to learn forex trading. Quick 2 years of economic boom, fast rising inflation followed by also quick tightening, interest rate cuts and hikes just in two years. Someone who started trading for the last 1-2 years experienced and saw the things like he is trading for 10 years. This was like time travelling to 2008. Actually this is more educational than 2008 since that crisis builded up in 6 years and this one just took 2 years. We have seen the bottom in March 2020, expansion cycle till Nov....Ignored
Disliked{quote} Yes, they are all hawkish. I think you should be paying attention to the consensus and actual differences between the central banks. Note which central banks were hawkish than anticipated. For example, Reserve Bank of New Zealand is hiking the rates since November if i am not mistaken but those rate hikes were always aligning with the consensus, so it did not make much difference in the market. Actually when you look at NZDUSD you will see that it was falling until 28 January 2022. Despite RBNZ being more hawkish than the FED. So i think...Ignored
DislikedWould you care to elaborate more on your EUR/GBP position and why you feel you made a mistake?Ignored
Disliked{quote} Take a look at my last post in this thread about EG, before the ECB meeting, there's a line that says: "Coming to the ECB, both inflation and core inflation data that came out yesterday was higher than expected. Which may trigger a more hawkish ECB than we expect. So it's better to be careful." I kinda accepted the fact that risks on my EG shorts grew. But still tried to stay hopeful and kept my positions open. Which is not very logical. Instead of doing that i should have thought like "Hmm inflation is way higher than expected, ECB can...Ignored
Disliked{quote} Right! I see what you mean now. I can learn from your mistake now too haha. Thanks for explaining, mateIgnored