Cable Update (GBPUSD)

FX OPTIONS: Daily Overview London, November 29. Spot EUR/USD Slumped first thing - through 1.4800 to levels ahead of 1.4720. Vols back out to the right - 1wk atmf paid 10.15 and a 1.4690 @ 10.5 (now includes ECB). 2week remains popular on an 11.0 handle, since yesterday"s FOMC inclusion. 1m atmf paid 9.3-9.4, 3m through 9.0 and 1yr to 8.3 (given later at 8.25 on size). Vols have eased marginally as spot sits back in mid .47"s. Big risk reversal trading 800mln a leg - 9 month 1.45 over 1.50 at 0.225. Spot Cable slipped back on to a 2.0500 handle and fuels downside interest across the curve - size buyer 6m 1.8400 at 12.4 GBP 300mln was the largest we heard today. Vol curve supported as risk reversals hold firm amid the ongoing short downside scenario. Vols along the EUR/GBP curve have eased further today - 1yr atmf given good amounts at 7.35-7.3-7.25. Similar story in EUR/CHF with spot back around 1.6500 from recent 1.6300 lows. Spot USD/JPY back toward the mid 109"s late on, but around 110.00 for the most part. No real change to vols throughout, with 1m atmf already down near 2.0 vols this week. 1m r/rev settles around 3.0 from 4.2 JPOY calls Monday. Big buyer 1yr 120.00 JPY puts at 8.0-8.1 - talk as much as USD 800mln. Recall this contract was given on close to USD 2bln from 8.7 through 8.5 in Tokyo on Monday.

o, for the love of the game..
it just hard not to be professional if we love the game.

ps:just reverse the trade to sell,

FX OPTIONS: GBP/USD Trade Idea - Buy 1-mth 2.1150 OT London, November 29. Cable scaled a 26-year peak of 2.1162 earlier this month (Nov 9), before tumbling to a low of 2.0352 seven days later (Nov 16) as the high-yielding pound was hurt by the unwinding of JPY-funded carry trades and the BoE"s quarterly inflation report"s hint at UK base rate cuts to come.
The final BoE MPC meeting of 2007 takes place next week (Dec 5/6), with the vote on a knife-edge between no change and a 25bp cut. Based on her dovish comments seven days ago (Nov 22), it appeared that Rachel Lomax would be joining John Gieve and David Blanchflower in voting for a 25bp cut.
However, Lomax was more neutral when she yesterday stated that BoE forecasts showing that interest rates may fall in the next two years are "projections, but not promises" (Hull Daily Mail/Bloomberg). And earlier today, the BoE Deputy Governor responsible for monetary policy told the UK Treasury Select Committee that what is happening to commodity and oil prices is a "big concern" just at the moment (Reuters).
At the start of this week, BoE Chief Economist Charlie Bean noted that domestic inflation may force the Old Lady to keep its monetary policy stance "tighter" than it otherwise would be (Liverpool Daily Post/Bloomberg). Both Lomax and Bean voted against July"s 25bp UK base rate hike to 5.75%. This was the final increase of a tightening cycle which commenced in August 2006 (when the base rate was upped from 4.5% to 4.75%).
The pound could be sold heavily if the MPC reduces the UK base rate to 5.5% next week, as it is unlikely to be a one-off "insurance" cut as per August 2005, but rather the start of an easing cycle.
However, a fifth consecutive "unchanged" verdict could spur the closing out of some short GBP positions. And with the FOMC expected to cut the Fed Funds rate by another 25bp to 4.25% on December 11, GBP/USD might find itself on the climb into year-end almost by default.
To position for such a possibility, it might be worth considering the purchase of an exotic One Touch option with a trigger set ahead of 2.1162. As an example, the buyer of a 1-mth 2.1150 OT will receive approximately three times the premium stake if the level trades before the December 31 expiry date.
Risk reversals hold a chunky premium for GBP puts, so GBP call options are relatively "cheap" to buy by comparison.

I am not in the sell game today
above 2.0640 buy, or no trade

sell is a good call, charts say sell

I'm getting confuse! Price action showing long...
Nevermind i will set my stoploss at 2.0650

Please go down cable... Please!!

yes but they take your wallet when they leave and her boyfriend comes and burgles you later

remember - Nick Leeson was a pro
So was Robert Maxwell

the bigger they are the harder they fall

we amateurs can do ok

cable go down, im getting sleepy!!

down cable down!!!

http://www.63xc.com/scotth/downarrow.jpg

that is true, I don't just trade chart
I trade plan, now it is too late to reverse that
better to watch and wave hands

theres always hedging

Agreed, that is what I need to take into consideration
in future. Instead of all day, but better than losing
my shirt over pips.

But for this trade, hedging is too late as well.
Also I find hedging to be a way of adding stress
to once stressful day trading activities. For position
traders it is fine.

We now have rising fractal patterns from 5mins frame
to hourly.

still not sure where it is going???????????

go up cable up till 700

down cable down!!

GBP/USD: Pullback More Accurately Reflective of Fundamentals New York, November 29. The GBP seems to be back on the proper path today following yesterday"s bout of relative strength from the currency on the back of the more hawkish than expected comments this week out from BoE governors Lomax and Sentance. Today"s release of the Nationwide house price data seems to have brought the market back to more accurately reflect the underlying fundamentals with the 0.8% decline coming in far worse than the 0.1% rise that had been expected.
Much like the Fed, the BoE is fully aware and concerned over the state of the global liquidity crisis and realizes that a further deterioration which is to be expected should result in an easing of monetary policy. Additionally, UK economic data continues to show the effects of the central bank"s tightening policy, with a slowdown in the economy also putting pressure on the BoE to ease.
There is strikingly little interest in the GBP from many of the accounts that had been so actively buying 6 months ago. Despite the broad based negative USD sentiment, many of these accounts recognize the transition in the BoE"s monetary policy, and view Cable over the 2.00 handle as overvalued. Instead there is increased interest in using the Yen as an alternative reserve currency, especially in the current risk averse global environment. This has resulted in a significant liquidation of the GBP/JPY carry trade which is expected to continue to decline over the long-term, which should act as an additional strain on Cable

lol, do you consider hedging?

too dangerous isnt it?
hedgers die early from heart attacks.

love it - 200 points up in day is described as 'strikingly little interest'

the best system is to listen to this twaddle and do the opposite

I start looking short

It may be good for those with money and long
or short but are already in good solid profit of say +200pips

Then they can just follow somebody like
this thread - QS blindly only on one side alone.

But for active day trader like me with small equity,
hedging is like a real blind person trading by himself
alone. If you know the limits of market there is no need
to hedge or scalp either.