BAM BAM BOOM! -bravado
- #5,662
- Jun 7, 2007 3:17pm Jun 7, 2007 3:17pm
- Joined Nov 2006 | Status: Shoot all the clowns.. Shoot'em all | 14,520 Posts
- #5,663
- Jun 7, 2007 3:21pm Jun 7, 2007 3:21pm
- Joined Jan 2007 | Status: Stochastic pipster | 1,657 Posts
- #5,664
- Jun 7, 2007 3:26pm Jun 7, 2007 3:26pm
- | Joined Aug 2006 | Status: BORED trader | 2,388 Posts
BAM BAM BOOM! -bravado
- #5,665
- Jun 7, 2007 3:30pm Jun 7, 2007 3:30pm
- Joined Jan 2007 | Status: Stochastic pipster | 1,657 Posts
- #5,666
- Jun 7, 2007 3:34pm Jun 7, 2007 3:34pm
- | Joined Aug 2006 | Status: BORED trader | 2,388 Posts
BAM BAM BOOM! -bravado
- #5,667
- Jun 7, 2007 3:35pm Jun 7, 2007 3:35pm
- Joined Jan 2007 | Status: Stochastic pipster | 1,657 Posts
- #5,670
- Jun 7, 2007 3:40pm Jun 7, 2007 3:40pm
- Joined Jan 2007 | Status: Stochastic pipster | 1,657 Posts
- #5,674
- Jun 7, 2007 3:51pm Jun 7, 2007 3:51pm
- Joined Jan 2007 | Status: Stochastic pipster | 1,657 Posts
- #5,676
- Jun 7, 2007 3:56pm Jun 7, 2007 3:56pm
I'm, but I'm bound to reconsider here.... Today's selloff just blew me up here... And as I said before, GU has all it takes to go down tomorrow, not to mention the stock market....
I hate to be clueless like I am right now... Best action is taking no action when I find myself like this...
This 10yr treasury above 5% turned the market upside down, just like was being said previsouly and I didn't believe... If 10yr continues upwards, the trade is stocks down, dollar up, carry trades unwinding... And 5% is long gone already....
Dow Jones was holding -1% a day for days, which hasn't impacted other markets... Today's 1,5% can also push the entire market down...
Don't try too hard to find reasons for market movements, just stick with what the charts tell you. Today isn't exceptional for this cross. The past 2 months of low volatility were more exceptional. Sometimes it helps to zoom out of the M15/H1 charts and check the daily and monthly for a better perspective. Check the daily charts and you notice that last year this puppy used to have very regular corrections of 400-600 pips in 3-5 days, just to resume it's trend.
What has changed since than?
The interest rate differential is bigger than ever, japanese economy is still struggling to shrug off deflation (or BOJ/MOF is still manipulation the hell out of their inflation/consumption data
: ) and the BOE is struggling with historic high inflation. So not much change on the fundamentals with last year.What has changed is that the february correction (result of jap end of year repatriation, tankan report, japanese rate hike and soaring global equities partially funded with cheap yen) reminded us that the carry trade is not a free ride to unlimited cash and with the historic highs in global markets (EUR,AUD,NZD, GBP, Gold, stock markets) the carry is attracting loads of attention and markets get nervous. So expect more volatility, but the main trend is up up up. Where it ends 248, 260 , 286.... only god knows and no doubt about it, it will be voilent. But I only know that I'm a buyer above 226 for sure and perhaps even down to 212 as long as the IRD remains this sweet. Shorting this monster is just suicide, at least for me.
Good luck to you all it'll be interesting to watch the coming days and I hope to build some nice longs to hold for dear life.
I dont take it like this, hedging your position gives you a rest.
If the pair sticks with the downtrend you lock your losses until the pair rebond then you close your hedge and take the pips...
Of course if the trend continues to go down you are loosing again but this gives you a chance to recover your losses for a very small cost (.5$/day/.1 lot if i'm not wrong )
I guess its just a matter of taste.
- #5,678
- Jun 7, 2007 4:01pm Jun 7, 2007 4:01pm
- | Joined Aug 2006 | Status: BORED trader | 2,388 Posts
BAM BAM BOOM! -bravado
- #5,679
- Jun 7, 2007 4:03pm Jun 7, 2007 4:03pm
- Joined Nov 2006 | Status: Shoot all the clowns.. Shoot'em all | 14,520 Posts
Not to trade is a trading decision too!
Don't try too hard to find reasons for market movements, just stick with what the charts tell you. Today isn't exceptional for this cross. The past 2 months of low volatility were more exceptional. Sometimes it helps to zoom out of the M15/H1 charts and check the daily and monthly for a better perspective. Check the daily charts and you notice that last year this puppy used to have very regular corrections of 400-600 pips in 3-5 days, just to resume it's trend.
What has changed since than?
The interest rate differential is bigger than ever, japanese economy is still struggling to shrug off deflation (or BOJ/MOF is still manipulation the hell out of their inflation/consumption data
What has changed is that the february correction (result of jap end of year repatriation, tankan report, japanese rate hike and soaring global equities partially funded with cheap yen) reminded us that the carry trade is not a free ride to unlimited cash and with the historic highs in global markets (EUR,AUD,NZD, GBP, Gold, stock markets) the carry is attracting loads of attention and markets get nervous. So expect more volatility, but the main trend is up up up. Where it ends 248, 260 , 286.... only god knows and no doubt about it, it will be voilent. But I only know that I'm a buyer above 226 for sure and perhaps even down to 212 as long as the IRD remains this sweet. Shorting this monster is just suicide, at least for me.
Good luck to you all it'll be interesting to watch the coming days and I hope to build some nice longs to hold for dear life.
We have to bear in mind that interest rates are among the biggest market movers here and the 10yr above 5% is signaling a possible hike from FED. And we also know that it is not about FED raising or not. It is about what the market feels about it. And right now, USD bullish is likely to become a reality in the near term.
How would this affect carries? Well, goodbye swaps, market is going after 10yr, like shown today....
- #5,680
- Jun 7, 2007 4:06pm Jun 7, 2007 4:06pm
- Joined Nov 2006 | Status: Shoot all the clowns.. Shoot'em all | 14,520 Posts