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GBP/JPY for QQE Traders!

  • #801
  • Jan 30, 2008 12:40pm Jan 30, 2008 12:40pm
I don't feel a 50bp cut, but more smthg like 25bp...
The Fed got trapped last week by the SocGen trader, and cut by 75bp... which I guess already embodies the potential 50bp rate cut of today. I see a 25bp cut, or maybe nothing...
No position for me... good luck with your shorts!
  • #802
  • Jan 30, 2008 12:41pm Jan 30, 2008 12:41pm
Quoting Michi
I don't feel a 50bp cut, but more smthg like 25bp...
The Fed got trapped last week by the SocGen trader, and cut by 75bp... which I guess already embodies the potential 50bp rate cut of today. I see a 25bp cut, or maybe nothing...
No position for me... good luck with your shorts!
  • #803
  • Jan 30, 2008 12:42pm Jan 30, 2008 12:42pm
though my CAD short's workin out.... ;-)
  • #804
  • Jan 30, 2008 12:58pm Jan 30, 2008 12:58pm
traders on CNBC say that the market expects 50bp, and that a lower cut would be negatively viewed by the market.

Therefore: markets should go down, risk aversion going higher, and GY going down as well...
So basically USD should also lower in case of a 25bp... no fundamental theories are right anymore... that's just gut feel !
  • #805
  • Jan 30, 2008 1:21pm Jan 30, 2008 1:21pm
hope all the shorts were closed out.........
  • #806
  • Jan 30, 2008 1:22pm Jan 30, 2008 1:22pm
yes... hope for you guys too!
I thought about you when I saw GY jumping up !
Volatility is back ! Nice !
  • #807
  • Jan 30, 2008 1:23pm Jan 30, 2008 1:23pm
Quoting Michi
yes... hope for you guys too!
I thought about you when I saw GY jumping up !
Volatility is back ! Nice !
I had my Trailed tightly in case this happened and it did.....
my EU and CADs were trailed nicely as well.

Hope we get back to normal now.... for the Beast that is.
  • #808
  • Jan 30, 2008 1:25pm Jan 30, 2008 1:25pm
Quoting kujo17
I had my Trailed tightly in case this happened and it did.....
my EU and CADs were trailed nicely as well.

Hope we get back to normal now.... for the Beast that is.
So whats the target now?
  • #809
  • Jan 30, 2008 1:27pm Jan 30, 2008 1:27pm
Why are my technicals and my logic lying to me
  • #810
  • Jan 30, 2008 1:29pm Jan 30, 2008 1:29pm
I'm done with the US sesh.
This big spike bar will throw off all the charts and fibs.

Once it settles down, I'll reevaluate.

I still think we have/need the retrace down to the DP/daily 5SMA of 212.4 area and then resume our Daily/Weekly UP trend.

Asian session has been hitting a 50% fib retrace almost every day.

So, once she calms down, a slow drop and then UP.

Just an idea of things to come..... she could go anywhere......
  • #811
  • Jan 30, 2008 1:30pm Jan 30, 2008 1:30pm
Quoting Pirin
Why are my technicals and my logic lying to me
you mean the short call ?
  • #812
  • Jan 30, 2008 1:31pm Jan 30, 2008 1:31pm
Technicals were short all the way.
But news throws that all out the window.

As I thought, a .5 or .25 cut would send it up, due to the fact that the .5 was already priced in.....

a .75 would have TANKED alot of things....
  • #813
  • Jan 30, 2008 1:36pm Jan 30, 2008 1:36pm
I still believe that we will experience a major drop in the gbp/jpy ... I'll wait till tomorrow, so that the monthly charts closes and if it closes below the 200 sma I'll execute another short order. Did you saw when the news came out how the price begin jumping up and down, didn't knew where to head up.
  • #814
  • Jan 30, 2008 1:37pm Jan 30, 2008 1:37pm
Quoting kujo17
you mean the short call ?
exactly, I thought the rate cut will be the trigger.
  • #815
  • Jan 30, 2008 1:39pm Jan 30, 2008 1:39pm
yes now the thing is to wait a little bit to be back in business... the present volatility could go anywhere.
The overall view is still bullish though...
  • #816
  • Jan 30, 2008 1:44pm Jan 30, 2008 1:44pm
Quoting kujo17
As I thought, a .5 or .25 cut would send it up, due to the fact that the .5 was already priced in....
In my pt of view: 25bp would have sent it down, while 75bp and 50bp would have sent it up...
The stock market was expecting and hoping at least a 50bp cut, otherwise it would have crashed. They have what they asked, confidence is getting higher, stocks are going up, risk aversion is lowering, therefore people are willing to take a little bit more risk and therefore will invest in carry trades: GY is going up.

If 25bp cut, stock market would have gone south... and after all my above explanation: GY too.
  • #817
  • Jan 30, 2008 2:02pm Jan 30, 2008 2:02pm
Here's phase one of the aftermath of the interest rate statement. G/U (far right) rises as the dollar loses value. U/J (middle) falls for the same reason. G/J (far left) is stuck in the middle, getting pushed and pulled both ways.
Attached Image (click to enlarge)
Click to Enlarge Name: rate_change.jpg Size: 383 KB
  • #818
  • Jan 30, 2008 2:03pm Jan 30, 2008 2:03pm
Quoting Michi
In my pt of view: 25bp would have sent it down, while 75bp and 50bp would have sent it up...
The stock market was expecting and hoping at least a 50bp cut, otherwise it would have crashed. They have what they asked, confidence is getting higher, stocks are going up, risk aversion is lowering, therefore people are willing to take a little bit more risk and therefore will invest in carry trades: GY is going up.

If 25bp cut, stock market would have gone south... and after all my above explanation: GY too.
I don't think that rate cutting is lowering the risk aversion. Especially when we are talking about surprising 0.75 and expected 0.5 cuts. That is only showing that the situation is really bad. Yes the stock market will react positively, they like to see a weak dollar in the short term, but that doesn't bring confidence to the traders to put their money in risky carry trades. I remain bearish ... we'll see what happens. I'm just asking myself why didn't I made a long eur/usd call instead of risking it with the gbp/jpy ... but high volatility made me greedy.
  • #819
  • Edited 2:43pm Jan 30, 2008 2:30pm | Edited 2:43pm
In phase two G/U and U/J retrace and settle down. Then investor reaction takes over. If the sentiment is positive, the stock market will rally and U/J will start rising again. This would allow G/J to rise.

In phase three investors forget all about it (early next week?) and we're back to business as usual.
  • #820
  • Jan 30, 2008 2:39pm Jan 30, 2008 2:39pm
Let me quote myself :

" No matter where you put your stop loss at, it will be hit just before the market goes your way. "
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