End of Carry Trade | Page 2 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

Carry trade vs carry trader 3 replies

Can you teach me Carry Trade and Swing Trade? 5 replies

Is This The End of the Yen Carry Trade? 39 replies

End of the Carry Trade? 3 replies

hedging the carry trade 2 replies

Attachments: End of Carry Trade
Exit Attachments

End of Carry Trade

  • #21
  • Jul 30, 2007 1:43pm Jul 30, 2007 1:43pm
Quoting Mr demark
are you talking about these ratios?
Yep, that is one way to look at it. Another forum that talks a lot about carry trades is the one at OANDA.

Most of the brokers have a write-up about interest rates on their sites with examples. Trick is just to get everything lined up in a way you feel comfortable with. Over at OANDA there is a nice interest calculator that can give you a feeling for what's happening:
http://www.oanda.com/products/fxmath/interest.shtml
  • #22
  • Jul 30, 2007 1:45pm Jul 30, 2007 1:45pm
Good day all

1:00 Pm GMT passed and 118.00 hasn't been broken, but time always can tell so many words

It's a Contracting triangl and if we look to the chart, it means that Asia session will have a very

speedy and long profitable movement, I am going to add another contract ( SELL 119.00 ) as the

picture is very clear now to me

Many thanks
Attached Image (click to enlarge)
Click to Enlarge Name: USDJPY30JULY2small.jpg Size: 29 KB
  • #23
  • Jul 30, 2007 2:37pm Jul 30, 2007 2:37pm
Quoting G-Man
Don't forget the carry trade is not only about interest rates, but about the rate fo return.

Many of the YEN being sold to buy AUD, NZD, GBP and EUR have been invested in assets demoninated in those currencies, so if it appears that there is weakness or volatility in those asset groups then YEN may be repatriated.

It is worth keeping an eye on other investement groups if trading anything based on varry trades.

Personally the recent correction is very small on a long term scale, and I would expect a blow-off top when this eventually ends, which I don't believe we have had yet. GBPJPY may hit 260 before the trend changes with any significance. This is also supported by my definition that market moves are always more rapid when corrections to the main trend occur, similar to what we have experienced in the last few days.

As always, DYOR.

G-Man
Good thinking

Clusterwise: The carry trade has been a growing phenomenon over the past several YEARS. To try and pick the exact end of it based on a fleeting look at a few charts is like trying to pin the tail on the donkey. It doesn't help that the fundamentals seem to be against you too.... On the other hand... the subprime problem doesn't seem to be going away and it could lead to volatility across many areas and asset classes. Volatility is not the carry trader's friend. In any case, make sure you don't risk too much margin on this, or any other trade just because the charts get you all hot:
Quote
I am going to add another contract
  • #24
  • Jul 30, 2007 3:06pm Jul 30, 2007 3:06pm
Quoting fierceman
Good thinking

Clusterwise: The carry trade has been a growing phenomenon over the past several YEARS. To try and pick the exact end of it based on a fleeting look at a few charts is like trying to pin the tail on the donkey. It doesn't help that the fundamentals seem to be against you too.... On the other hand... the subprime problem doesn't seem to be going away and it could lead to volatility across many areas and asset classes. Volatility is not the carry trader's friend. In any case, make sure you don't risk too much margin on this, or any other trade just because the charts get you all hot:

chart = human psychologic

it's not only a matter of 5 words, those human are creating that chart , you need to understand thier psychology, it's tat simple but the path is difficult.
  • #25
  • Aug 1, 2007 12:56am Aug 1, 2007 12:56am
Good day all

+100 pips

if we break 118.00 , the game will start

Many thanks
  • #26
  • Aug 1, 2007 2:17am Aug 1, 2007 2:17am
Well, I've certainly made my own several bucketloads of pips shorting the yen crosses during this correction but that's still all it is... a correction...

In fact, this unwind still isn't even as profound as the one that occurred in February of this year, though I do think it will be.

In the long term, on every single chart I look at, the bias is still to the upside, however. The problem with just banking on that, though, is that not many people have the bank rolls to just sit on a 1000 or 2000 pip loss while waiting for the long term trend to take over once again. Especially when you take into account the leverage being applied to those pips.

I believe we're more likely to see 300 in the GBP/JPY this year than we are to see 200, but while waiting for this wave of risk aversion to bottom out, I'll be happy to cash in on all the people who are addicted to the carry trade.

There is a time and a place for everything and this simply isn't the time to be going long for the sake of rollover interest.

The carry trade, as it applies to the Yen crosses, is far from dead but it's certainly in a holding pattern right now. We should all appreciate this situation for exactly what it is... a fantastic bottom to fish.
  • #27
  • Aug 1, 2007 2:53am Aug 1, 2007 2:53am
well from my point of view g/j may be the biggest loser as g/u was aleary so hight and some divergence could bring some bads news fron england...so this may add stuff to g/j downside....On other side u/j may find some support due to the fact that some risker out come asset goes into treasury...that what gbp dont have!So at last we may see g/u down!
  • #28
  • Aug 1, 2007 4:15am Aug 1, 2007 4:15am
Big un.

BTW, there is no isolation. If carry dies, all die.

All components.

That's EURCHF, GBPCHF, USDJPY, EURJPY, GBPJPY, AUDJPY, NZDJPY, NZDUSD, AUDUSD, etc, etc, etc.

As obviously a cross has two parts - USDJPY and the Yielding pair. So BOTH are sold at the same time when it melts.

There is no isolation.
Attached Image
Trust price. Know yourself.
  • #29
  • Aug 1, 2007 4:26am Aug 1, 2007 4:26am
DJI Futures - almost 100% correlated with carry lately
Attached Image
Trust price. Know yourself.
  • #30
  • Aug 1, 2007 5:34am Aug 1, 2007 5:34am
Carry trade will continue unless the wide interest rate gap exists, but gradually decrease. I feel that Yen will be stronger against its crosses for the next coming months and years, maybe. Japanese land prices are climbing at fastest pace in 15 years. The interest rate will be gradually raised by BOJ for sure in coming years.

http://www.marketwatch.com/news/stor...4AC6C8001AD%7D
  • #31
  • Aug 1, 2007 6:57am Aug 1, 2007 6:57am
Here is a note from a Japanese about the coming month August:

http://www.forexfactory.com/showpost...&postcount=151
Quoting Fumafuma
Generally speaking, August is called "summer decline market" month in Japan. Even if each person may close a position(liquidation of longs) at some stage, people would have no alternative other than to reinvest earnings.
  • #32
  • Aug 1, 2007 11:36am Aug 1, 2007 11:36am
Oh, that was my post....Yes, BurgerKing. In general, we call August "Natu-gare souba(夏枯れ相場）". It means summer dry season in the market. But, juding by present circumstances, I personally feel that we promptly perform further buying as long as there's a chance. Of course we need to be wary of deception in the world market though.
Peace and Happiness through Prosperity (by Konosuke Matsushita)
  • #33
  • Aug 2, 2007 2:06am Aug 2, 2007 2:06am
I just had a chat with a Hong Kong Stock Trader and he said that July-August-September as "lean months"...

Last year, when I first joined forexfactory, I read that August/September are lean months for the americans as these are the months they take vacations...

Interesting... hmmm... This seems like a universal theme...


But as far as carry trades are concern, I'll take the cue from the veterans/pro (Japanese) and follow them.
  • #34
  • Aug 2, 2007 3:39pm Aug 2, 2007 3:39pm
yup we often have those so called summer ranges as far i remmeber

revoke
  • #35
  • Aug 4, 2007 12:30pm Aug 4, 2007 12:30pm
Good day all

We had a nice close

USDJPY is taking his last breaths

I will update you with the chart later

Many thanks
  • #36
  • Aug 5, 2007 2:53pm Aug 5, 2007 2:53pm
USDJPY price now according to FXSOL = 117.66
  • #37
  • Aug 5, 2007 3:01pm Aug 5, 2007 3:01pm
ya clusterwice i have 117,65 current and again a weekend wondering and listening with my eyes on JPY crosses i decided to stay sidelined cause i have no clear mind but it really looks like a dangerous cocktail with usdjpy with lower rates and eurusd going up regarding eurjpy also gbpjpy gapping current below 240 figure

revoke
  • #38
  • Aug 5, 2007 3:09pm Aug 5, 2007 3:09pm
Quoting revoke
ya clusterwice i have 117,65 current and again a weekend wondering and listening with my eyes on JPY crosses i decided to stay sidelined cause i have no clear mind but it really looks like a dangerous cocktail with usdjpy with lower rates and eurusd going up regarding eurjpy also gbpjpy gapping current below 240 figure

revoke
yeah revoke, I believe this is the reversal of the long trend

I call it end of carry trade
  • #39
  • Aug 6, 2007 1:05pm Aug 6, 2007 1:05pm
a sketch of 4H USDJPY chart

http://www.arb-up.com/get-8-2007-vrzypn24.jpg
  • #40
  • Aug 9, 2007 2:56pm Aug 9, 2007 2:56pm
Carry traders are dying

We still hold our positions

Many thanks
0 traders viewing now