USD/JPY Discussion

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Hi guys,

As I was one of the annoying people who asked questions that had been asked many times before, I have compiled many of Dove's posts that have comments relating to the way he trades with pivots which I think will include many of the anwers that any newbies or others who can't find specific posts are looking for.

They are a bit disjointed abd some may seem out of context but it is the points that he is trying to make that are important. If there are exect points given I have included the date of that post in red ABOVE the text that was posted on that date. Any comments made by other posters are in italics.

On a seperate note I would endorse Doves principle of giving some trading profits to charity. You don't need to go big and give 50%, but it gives you a big sense of self-worth, and I think it helped to make me better trader as it gives you another focus. If you can't focus, don't trade.

If you are not profitable I would suggest that you resolve to give the profits from your next 5 profitable trades to charity, even if they are only $10. If you don't have any profitable trades at all then get back to demo trading. It will make you feel good, I guarantee it.

So you guys know, I have been trading for about 5 years. Started off very well, mainly using pivots and hence my interest in Doves methodologies, but I have had a bad time losing too much money trying to make easy money with automated trading for the past 18 months. Now getting back into the nuts and bolts, and getting back into the swing of things and the rythmn of the markets. Picked up a small 20 pips so far today using Doves ideas. Missed the original entry sell off the central pivot, but plenty of retraces to get in on the downtrend.

I've never been great at posting charts but I will try and if can't do the charts I will still post my trades to see if we can all help each other together.

Hope this little doc helps.

Good trading everyone.

G-Man

Hi G-Man....great post and thanks for all the hard work with the Doc...you must have heard my thoughts from earlier! Look forward to seeing your posts.

Islander

why did dove leave?

Just in case you didnt find his reason

http://www.forexfactory.com/showpost...postcount=2253

So it appears we are once again in the midst of a subprime spawned sell-off.

Big liquidation going on.

With all the rumours around in the markets looks like this time it could be serious.

USDJPY just hit S2 by the way.

G-Man

Well these aren't rumours,they're facts this time. The ECB lent over a 100 billion in Euros to ease liquidity. A German and French bank have funds in disarray and of course we have China threaten to use their reserves as a poison pill measure. We might have a serious meltdown on our hands today.

i see.
appreciate the link.

It's going to go for the weekly trend line ..and probably take it out.

<edit>That's the 117.90 correct?

That I believe would be the inner trend line. There's an outer trend line as well

I believe that is the 117.16

Well its the rumours such as WestLB having liquity issues that have pushed the cost up causing the ECB to increase liquidity.

Either the rumours are about to unfold, in which case a MAJOR sell off is going to ensue, or the'll prove unfounded and some stability and liquidity will return.

G-Man

edit: and while I was typing this, pulled another 9 pips out of UJ. I'm liking the retracement idea Dove has reignited in my head.

ECB Offers Unlimited Cash as Bank Lending Costs Soar (Update4)
By Gavin Finch and Steve Rothwell
http://bloomberg.com/apps/data?pid=a...d=iXFfbqfssGzIhttp://images.bloomberg.com/r06/news/enlarge_image.gif A euro sign sculpture is seen outside the ECB in Frankfurt


Aug. 9 (Bloomberg) -- The European Central Bank, in an unprecedented response to a sudden demand for cash from banks roiled by the subprime mortgage collapse in the U.S., loaned 94.8 billion euros ($130.2 billion) to assuage a credit crunch.
The overnight rates banks charge each other to lend in dollars jumped to the highest in six years. The London interbank offered rate rose to 5.86 percent today from 5.35 percent and in euros gained to 4.31 percent from 4.11 percent.
The ECB said it would provide unlimited cash as the fastest increase in overnight Libor since June 2004 signaled banks are reducing the supply of money just when investors are retreating because of losses from the U.S. mortgage slump. BNP Paribas SA halted withdrawals from three investment funds today because the French bank couldn't value its holdings. Stocks in the U.S. and Europe fell and Treasury bonds rose, a turnaround from the past three days when investors concluded that credit market risks were abating.
``Liquidity in the market has completely dried up as investors aren't recycling their money back because of subprime concerns,'' said Saher Bin Jung, a trader on the commercial paper desk at Commerzbank AG. ``Levels have shot up dramatically since yesterday as issuers are trying to entice investors back.''
The ECB said today it provided the largest amount ever in a single so-called ``fine-tuning'' operation, exceeding the 69.3 billion euros provided on Sept. 12, 2001, the day after the terror attacks on New York.
Fed Reserves
``Banks reacted to the ECB's `sale' offer in a similar way one would react to a sale in a department store'' and ``got all the money they could,'' said Ulrich Karrasch, a money market trader at HVB Group in Munich.
The U.S. Federal Reserve added $12 billion in temporary reserves to the banking system today when it arranged 14-day repurchase agreements, or repos, about the amount analysts predicted. Just two days ago, the Fed said ``tighter'' credit conditions aren't a threat to economic growth.
Fed spokesman David Skidmore declined to comment on the increases in overnight money-market rates.
The ECB's announcement added to investor nervousness, pushing Europe's Dow Jones Stoxx 600 Index down 2.1 percent and the Standard & Poor's 500 Index of U.S. shares down 1.6 percent to 1,473.74. U.S. Treasury notes gained for the first time in four days as investors sought the safest assets, cutting yields on two-year notes by 13 basis points, or 0.13 percentage point, to 4.52 percent.
Corporate Bond Risk
The euro fell 0.9 percent to $1.3672, its biggest decline in more than a year. It dropped 2 percent versus the yen in the largest slump in two years.
``The one down side to the ECB doing something is that it may suggest there are more issues out there,'' said Barry Moran a euro-money market trader at the Bank of Ireland in Dublin. ``People are nervous.''
Credit-default swaps on the CDX North American Investment- Grade Index rose 10 basis points to 70 basis points, according to Phoenix Partners Group in New York, reflecting an increase in the perceived risk of owning corporate bonds.
Three-month dollar Libor rose to 5.5 percent from 5.38 percent.
`Extraordinarily Serious'
Concerns increased as BNP Paribas, France's biggest bank, stopped investors withdrawing from funds with assets totaling 2 billion euros because it couldn't ``fairly'' value their holdings after the sell-off in credit markets.
``For some of the securities there are just no prices,'' Alain Papiasse, head of BNP Paribas's asset management and services division, said in an interview. ``As there are no prices, we can't calculate the value of the funds.''
Dutch investment bank NIBC Holding NV also said it had lost at least 137 million euros on subprime investments.
For Bank of America Corp., the No. 2 U.S. bank by assets, today's increase in overnight borrowing costs was the biggest since the Federal Open Markets Committee raised interest rates at the end of June 2004. For UBS AG in Zurich, it was the largest jump since Europe's No. 1 bank by assets said in August 2004 that it may have overestimated its value-at-risk by more than 20 percent.
Both banks said their overnight borrowing costs rose 65 basis points to 6 percent. Royal Bank of Canada and Barclays Plc also said they're paying 6 percent.
``This is an old-fashioned credit crunch,'' Chris Low, the chief economist at FTN Financial in New York, said in a report today. ``This is not a small thing. A credit crunch, when the short-term credit markets seize up, is extraordinarily serious, almost always the precursor of a significant recession.''
To contact the reporter on this story: Gavin Finch in London at [email protected] ; Steve Rothwell in London at [email protected]

Good post DT. That has all the info we need at the moment.

Incidentally, are you actually a Dutch trader?

G-Man

Yep, born and raised in the Low lands currently living in the US

Someones buying UJ. Could be signalling another day of reversals.

I would suggest staying out unless your brave or reckless.

G-Man

Dove has said he is done posting here.
Look back 2 pages

I think this is just a retrace. It's going to head down more :-D