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Jacko's Forex House of Pleasure and Pain

  • #961
  • Edited 9:50am Oct 2, 2007 9:37am | Edited 9:50am
Quoting raczekfx
3rd.
They'll sell cable and fiber to push $ higher.
When faith in $ returns , they'll quietly start selling their $ reserves...

Hi raczekfx,

Exactly.

They have control of the USD by means of their $Trillion of debt owed by the US government to China. The increasing US debt is the same as "buying" the USD.

However, the $200 Billion can be used to sell the Euro (and to a lesser degree, the GBP and other less important currencies). The investment fund is to get control of the Euro. (they already have de facto contol of the US dollar....). They will then buy it back later and make their profits....then do it all over again.

They now have the financial firepower to do it for as long as it wants...and use it to get concessions from all other countries, but primarily the US and European Community

They are going to manipulate the currency markets using this monsterous investment fund. If it needs more money, the China government will give it another $500 Billion and not even flinch!!!

The elephant is in the China shop !!! (pun intended).


.
  • #962
  • Oct 2, 2007 9:42am Oct 2, 2007 9:42am
Quoting jacko
1. They will use it to sell Euros (primarily) versus the USD.

Will explain more later.


.
This amount of investment against the Euro could possibly reverse a long term trend. I anxiously await your analysis.
  • #963
  • Oct 2, 2007 9:45am Oct 2, 2007 9:45am
My timing was off as usual. You were resopnding as I was typing my post. Thanks Jacko
  • #964
  • Oct 2, 2007 9:49am Oct 2, 2007 9:49am
  •  MPP
  • Joined Jun 2007 | Status: Be yourself, everyone else is taken | 2,734 Posts
Quoting Mr Trend
Jacko.. I'm a big believer in scaling in and do so myself... but I don't see how you can utilize a scaling in strategy without hurting your AH strategy and opening yourself up to more risk...

Clarification would be nice... and just hearing how others are triggering their scale-ins would be a benefit to me. Scaling in is an artform...
by scaling in do you mean increasing a position as the trade moves in your direction?

if so i always do it, i am trading on a mini accoount so don't have the funds to make large orders as my MM won't allow it.

I still use th A-H stratagy when scaling in, recently i started scaling in at 1.3800 and added every 50pips, once my first 2 trades have moved 50pips (price at 1.3900) my risk on all other entries is zero

Price Lots SL Trail PIPs
1.38 5 -50 50 -250
risk-250
1.38 5 1 5
1.385 5 -50 50 -250
risk-245
1.38 5 50 50 250
1.385 5 1 50 5
1.39 5 -50 50 -250
risk5


risk is the position i would be in if all SL hit.

it's just the way i do it, each trade is as individual as the first, but my money management is still intact.
  • #965
  • Oct 2, 2007 10:08am Oct 2, 2007 10:08am
Quoting Archer
This amount of investment against the Euro could possibly reverse a long term trend. I anxiously await your analysis.

Hi Archer,

Definitely. If the Investment fund wants to sell the Euro at these high prices and buy them back at lower levels, then the long term trend is over.

Also if they sell the Euro, it increases the value of their $Trillion holdings. It is a "heads they win and tails they win" type situation for China.

I think the only thing that will moderate this is that they will not want to be immediately seen as getting a choker hold on the markets (especially the Euro) straight away.

On the other side, I am dubious that they would be a big buyer of the Euro since
1. It is very high already
2 For every one cent increase in the Euro, the $Trillion holding reduces by $8 BILLION in value.


So I am on alert for maybe the topping of the Euro. However, the Investment fund has only opened for business 24 hours ago. So I will be looking for evidence in the price of the Euro. Caution is now the name of the game.



However, I could be wwwwwrong !!!



.
  • #966
  • Oct 2, 2007 11:27am Oct 2, 2007 11:27am
Quoting jacko
1. They will use it to sell Euros (primarily) versus the USD.

Will explain more later.


.

Hi Jacko:

When you have time would you please explain, the movement of Euro/Usd, its relationship with dollar, or what should I be looking at which would effect the Euro/Usd movement.

Thanks
Zee
ZHK
  • #967
  • Oct 2, 2007 11:28am Oct 2, 2007 11:28am
Quoting jacko
Hi Archer,

Definitely. If the Investment fund wants to sell the Euro at these high prices and buy them back at lower levels, then the long term trend is over.

Also if they sell the Euro, it increases the value of their $Trillion holdings. It is a "heads they win and tails they win" type situation for China.

I think the only thing that will moderate this is that they will not want to be immediately seen as getting a choker hold on the markets (especially the Euro) straight away.

On the other side, I am dubious that they would be a big buyer of the Euro since
1. It is very high already
2 For every one cent increase in the Euro, the $Trillion holding reduces by $8 BILLION in value.


So I am on alert for maybe the topping of the Euro. However, the Investment fund has only opened for business 24 hours ago. So I will be looking for evidence in the price of the Euro. Caution is now the name of the game.



However, I could be wwwwwrong !!!



.
Hi Jacko,
I agree with you BUT I have one doubt:

China Investment Fund has, for the moment, $200 billions. Yes, It's a lot of money but if we consider the daily (DAILY!) forex turnover of about $2.000 (*) billions it seems to me that chinese fund is too small to change (alone) a LONG term trend.

Of course if they sell $200 billions of fiber this might act as a catalyst for other traders but, again, I think this as a short term spinoff because many other countries are doing exactly the opposite, buying euros and selling dollars.

I think we are going to see "only" a good-short-term retracement (300 - 500 pips) and only if they are planning to put everything on fiber and not on other pairs.

Thank you, Jacko! I love your thread!

(*) I know $2.000 billion are not totally on fiber.

P.S. Sorry for my bad english.
  • #968
  • Oct 2, 2007 11:36am Oct 2, 2007 11:36am
Quoting johnedoe
1 Chinese yuan = 0.133172 U.S. dollars */-

2 possible outcomes.......

1. their money is weak and they will use this 200 BLN fund to shore up the dollar because of our trade deficet with them,
or
2. or they are pissed at us and will use it to further weaken the dollar as they shift to a stronger currency.....

or maybe I just don't have a clue..... and I'm just blowin smoke.
I believe China will not want a weak dollar as it means less export to its largest trading partner.
Take a report.
  • #969
  • Oct 2, 2007 11:48am Oct 2, 2007 11:48am
Quoting owkenobi
Hi Jacko,
I agree with you BUT I have one doubt:

China Investment Fund has, for the moment, $200 billions. Yes, It's a lot of money but if we consider the daily (DAILY!) forex turnover of about $2.000 (*) billions it seems to me that chinese fund is too small to change (alone) a LONG term trend.

Of course if they sell $200 billions of fiber this might act as a catalyst for other traders but, again, I think this as a short term spinoff.

I think we are going to see "only" a good-short-term retracement (300 - 500 pips) and only if they are planning to put everything on fiber and not on other pairs.

Thank you, Jacko! I love your thread!

(*) I know $2.000 billion are not totally on fiber.

Hi owkenobi,

Lets put it in perspective....

Forget about "Trillion dollar turnover" hype about the forex market. This is a market where any newbie trader can get 400:1 leverage....so the "Trillion dollar turnover" is a bit of Marketing hype.

Just for fun...lets assume that the China investment fund wants to leverage at 100:1....(and with their $ Trillion "account" with the "Bank of US Govt" there is a pretty good security!!!) ....lets see....$200 Billion X 100 .....that gives them $20 Trillion to smack the market any time they want....

I think that might move the market a "little" bit....

In all seriousness, this new fund will seriously distort/manipulate the Forex market, esp the Euro, but it will be so smooth nobody will be able to discern how or when it is happening.


.
  • #970
  • Oct 2, 2007 12:17pm Oct 2, 2007 12:17pm
Quoting jacko
Hi owkenobi,

Lets put it in perspective....

Forget about "Trillion dollar turnover" hype about the forex market. This is a market where any newbie trader can get 400:1 leverage....so the "Trillion dollar turnover" is a bit of Marketing hype.

.
Understood. You mean the daily $2.000 billions of forex are leveraged whereas chinese $200 billions are not.

WOW! So many things to learn...

Thank you to turn on the spotlight on my deceptive thoughts.

You're "the man", Jacko!
  • #971
  • Edited 1:17pm Oct 2, 2007 1:00pm | Edited 1:17pm
If I may add some of my thoughts?

Quoting jacko
However, the $200 Billion can be used to sell the Euro (and to a lesser degree, the GBP and other less important currencies). The investment fund is to get control of the Euro. (they already have de facto contol of the US dollar....). They will then buy it back later and make their profits....then do it all over again.

You moved from "can" to "is" pretty swiftly

Reading that last sentence("They will then buy it back later"..) made me think "Aren't we all a bit chinese then?"

Would be exactly what I want...a mobile market where movement = profit for the active trader =)

Quote
In all seriousness, this new fund will seriously distort/manipulate the Forex market, esp the Euro, but it will be so smooth nobody will be able to discern how or when it is happening.
But: if an effect is indiscernable, isn't then the outcome equal to no effect at all?

Or to paraphrase: if you use a tautological argument then you just end up biting yourself in the tail (saying: the market will be manipulated - in a way that nobody will see it as any different than before => "nobody will be able to discern how or when it is happening")

Quote
the "Trillion dollar turnover" is a bit of Marketing hype.
I've read elsewhere:

Quote
[..]the Bank for International Settlements on the FX market. Every three years they survey 54 central banks and monetary authorities, compiling data on volume, market share and so on. UK FX business since 2004 was up 80% to $1,359 billion daily increasing the lead role it plays with 34.1% of the total market. It has an even bigger share of OTC FX and interest rate derivatives with 42.5% of the total, $1,081 billion daily. Global numbers are even more staggering: FX turnover $3.2 trillion daily, roughly equal to the annual GDP of Germany according to Reuters, and derivatives $2.0 trillion daily. Emerging market currency turnover quadrupled in three years and now accounts for 20% of the total, Hong Kong and Singapore dollars the most active. FX volume in New York shrank to 16.6% while Switzerland’s almost doubled to 6.0%, the same as a shrinking Japanese volume, and a growing Singapore market with 5.8%.
It only sprang to my attention since it referred to our (I'm german ) GDP hehehe..
No idea how valid and verified the source is, but it sounded "official", as it always does =)

Also:

Been trying to find that one link about the amount and % in holding of PBOC / treasury's foreign reserves, also found some interesting thoughts, some rather outdated, some more recent(just via random google, but maybe some of them might be interesting):

http://tmcgee.wordpress.com/2007/04/11/pboc-fx-reserves-and-the-usd-part-mxxiv/
http://www.gocurrency.com/articles/china-bank.htm
http://macroblog.typepad.com/macroblog/2007/02/the_euro_vs_the.html
http://www.treas.gov/tic/fpis.shtml
http://www.rgemonitor.com/blog/setser/202810/
Trust price. Know yourself.
  • #972
  • Oct 2, 2007 1:36pm Oct 2, 2007 1:36pm
Quoting jacko
Hi Archer,

Definitely. If the Investment fund wants to sell the Euro at these high prices and buy them back at lower levels, then the long term trend is over.

Also if they sell the Euro, it increases the value of their $Trillion holdings. It is a "heads they win and tails they win" type situation for China.
.
Looking at the weakness of Euro in comparison with GBP since the start of the week, it seems that China Fund has started its mischief from the very first day or it may be a reaction of the news from big players.
  • #973
  • Oct 2, 2007 1:56pm Oct 2, 2007 1:56pm
  •  MPP
  • Joined Jun 2007 | Status: Be yourself, everyone else is taken | 2,734 Posts
Quoting FXHolic
Looking at the weakness of Euro in comparison with GBP since the start of the week, it seems that China Fund has started its mischief from the very first day or it may be a reaction of the news from big players.
not sure it's weekness, most likely end of month profit taking by jacko's broker, followed by other's fear the the top is in place. a retracement is due and then we buy in cheaper, just my view.
  • #974
  • Oct 2, 2007 2:02pm Oct 2, 2007 2:02pm
After this last run up, do you think it will drop to the 50% fib level during this retracement?
Same Whore .... Different Dress
  • #975
  • Oct 2, 2007 2:46pm Oct 2, 2007 2:46pm
Quoting johnedoe
After this last run up, do you think it will drop to the 50% fib level during this retracement?
The biggest enemy of any trader is his/her own opinion about where the market is going.
The next biggest enemy are opinions of friends and brokers about where the market is going.
Trade what you see, NOT what you hear or think.
  • #976
  • Oct 2, 2007 4:10pm Oct 2, 2007 4:10pm
Exactly......
Same Whore .... Different Dress
  • #977
  • Oct 2, 2007 4:28pm Oct 2, 2007 4:28pm
Quoting johnedoe
Exactly......
  • #978
  • Oct 2, 2007 4:29pm Oct 2, 2007 4:29pm
They did'nt take the bait did they Peter?
Same Whore .... Different Dress
  • #979
  • Oct 2, 2007 10:18pm Oct 2, 2007 10:18pm
Quoting FXHolic
The biggest enemy of any trader is his/her own opinion about where the market is going.
The next biggest enemy are opinions of friends and brokers about where the market is going.
Trade what you see, NOT what you hear or think.
Very true, nice phrase.
Added to my signature, hope you don't mind.

It's time to retrace!!!
I'll wait eur reach 1.40 or 1.39
On the daily and weekly TF, I see price movement to south.
Everything goes up will go down!
  • #980
  • Oct 2, 2007 11:20pm Oct 2, 2007 11:20pm
Quoting tony_klaten

...........

On the daily and weekly TF, I see price movement to south.
Everything goes up will go down !
Hi tony_klaten,

Yes......but not just yet.

It ain't over till it's over!


But ....I could be wwwwwrong!!


.
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