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Cable Update (GBPUSD)

  • #10,681
  • Apr 18, 2007 4:21am Apr 18, 2007 4:21am
Got this morning long at 2.0107 and took profit at 2.0130. Now I reversed and I'm short at 2.0110 with a SL at 2.0140.

I think there will come a small correction this day. (2.0050)
  • #10,682
  • Apr 18, 2007 4:22am Apr 18, 2007 4:22am
  •  CWH
  • | Joined Feb 2007 | Status: United We Buy, Divided We Sell | 249 Posts
Quoting iiivb
hmmm... what i meant is: is there any sense shorting cable now... maybe it is too high to buy... but the trend is up... VERY up... The support is the 2.0050 and 2.0 level... for the one thats asked me the support levels... And the "sleepy-bulls" or "bears" have really no fixed time to show up... They just appear, due to a fundamental reason... or whatever... they dont sleep.. so they appear whenever they like...
I'd liken that to the economic growth of China & India, fail to cool off from overheating..
"If, at first, you don't succeed, try, try, try again" - Winston Churchill
  • #10,683
  • Apr 18, 2007 4:26am Apr 18, 2007 4:26am
Why every trader attacking the Dollar? did you forget Guys that the dollar is the Currency of the biggest Economy in the World! When USA want her dollar strong then there are all the means to make it strong... The growth in USA for the comming year will be higher than the growth in Europe!
Europe is not interested to have its currency very strong which is bad for the export (and that in USA favor).
Today, the traders are the only one who value the currencies by running behind and waching the interest rate, Yes, interest rate is important but is not every thing...
  • #10,684
  • Apr 18, 2007 4:29am Apr 18, 2007 4:29am
After the immediate news jerk spike up to 0128, there have been no European buyers to take it higher - even with the euro moving well above 3600.

That leads me to think that the most probable move is for some profit taking

The alternative is a sideways drift into the US session and that would work off the over-bought short term charts and make an upward continuation more likely.
Trading Levels with WRBs
  • #10,685
  • Apr 18, 2007 4:29am Apr 18, 2007 4:29am
Quoting ndvt241
Europe is not interested to have its currency very strong which is bad for the export (and that in USA favor).
Blair on the wires yesterday, after breach of 2.0 saying Cable high helps fighting inflation...

What do we need now? The Queen?
  • #10,686
  • Apr 18, 2007 4:30am Apr 18, 2007 4:30am
Yes, but if you trade this timeframe you would be a fundamental year-trader... not an intraday technical trader... like the most of us... so WE are not wrong... and you are not right... if what u say is true, you will be right in a year or so... meanwhile the others will be right too in the coming days...

Quoting ndvt241
Why every trader attacking the Dollar? did you forget Guys that the dollar is the Currency of the biggest Economy in the World! When USA want her dollar strong then there are all the means to make it strong... The growth in USA for the comming year will be higher than the growth in Europe!
Europe is not interested to have its currency very strong which is bad for the export (and that in USA favor).
Today, the traders are the only one who value the currencies by running behind and waching the interest rate, Yes, interest rate is important but is not every thing...
  • #10,687
  • Apr 18, 2007 4:49am Apr 18, 2007 4:49am
so whats ur opinion cesarnc?? Time for some retracement or still go north?? Does the bull still have enough army to test another resistance ranks?? With no "important" news until end of week. Will it be fundies vs techies? Since the fundamentals so far support the cable to go bullish.
  • #10,688
  • Apr 18, 2007 5:08am Apr 18, 2007 5:08am
Quoting dd33
so whats ur opinion cesarnc?? Time for some retracement or still go north?? Does the bull still have enough army to test another resistance ranks?? With no "important" news until end of week. Will it be fundies vs techies? Since the fundamentals so far support the cable to go bullish.
I was just wondering what to do next... I made a mistake here and thought BOE would come out at 8:30 local (11:30 GMT) and overslept

I decided to do this.

Run fibo low 9902 - high 2.0131
23 - 0077
38 - 0044
50 - 0017
68 - 9990
78 - 9951

I'm not trading Cable until a strong rebound off one of those levels. I really want to see 38% as to reafirm the bullish move for the upcoming days.

Decided to do that because of
-lack of news for the rest of the day - allowing market decided where it goes - new stop hunting up or some profit taking

- USD super oversold across the board - this may buffer Cable's upside - unless we're in the middle of a USD breakout, and another wave of dollar selloff comes during NYC

- I have no idea where to place SL now if entering Cable long. That could cost me big drawdowns in case I go on buying dips and cable starts correcting within this fib.

- Retail Sales on Friday is expected below previous, so this one may set the rang Cable will trade until the rate statement.

- Shorting cable is something I'm not going to do. Not now.

Note that from 9211 up to now, there are almost 900 pips of accumulated profit. So when the profit takings come, it may get things ugly here.

I'll keep posting in case I change my mind.

As of now, I don't have a scenario to target my GBP trades. I'm only long UJ so far, risky enough to try to catch cable too
  • #10,689
  • Apr 18, 2007 5:38am Apr 18, 2007 5:38am
Just noticed, too, that 4hr and daily cable are reading extreme overbought conditions. As well as UJ is at oversold. This implies in USD oversold,

NYC may be the one to buy some dollar back to release those indicators.

In the lack of fundis today + not continuation in Cable after BOE minutes, we may have seen the hike's price. All of those indicators coming out of overbought conditions will set the stage for a good correction, possibly ahead of the weekend.

Trades may be techincal until tomorrow.

I'm watching.
  • #10,690
  • Apr 18, 2007 5:42am Apr 18, 2007 5:42am
Quoting cesarnc
I was just wondering what to do next... I made a mistake here and thought BOE would come out at 8:30 local (11:30 GMT) and overslept

I decided to do this.

Run fibo low 9902 - high 2.0131
23 - 0077
38 - 0044
50 - 0017
68 - 9990
78 - 9951

I'm not trading Cable until a strong rebound off one of those levels. I really want to see 38% as to reafirm the bullish move for the upcoming days.

Decided to do that because of
-lack of news for the rest of the day - allowing market decided where it goes - new stop hunting up or some profit taking

- USD super oversold across the board - this may buffer Cable's upside - unless we're in the middle of a USD breakout, and another wave of dollar selloff comes during NYC

- I have no idea where to place SL now if entering Cable long. That could cost me big drawdowns in case I go on buying dips and cable starts correcting within this fib.

- Retail Sales on Friday is expected below previous, so this one may set the rang Cable will trade until the rate statement.

- Shorting cable is something I'm not going to do. Not now.

Note that from 9211 up to now, there are almost 900 pips of accumulated profit. So when the profit takings come, it may get things ugly here.

I'll keep posting in case I change my mind.

As of now, I don't have a scenario to target my GBP trades. I'm only long UJ so far, risky enough to try to catch cable too
I agree but I think a retracement to say 2.0050 is imminent, perhaps in the next two to three hours? Anyone agree with my (newbie) opinion?
Gone to a better place
  • #10,691
  • Apr 18, 2007 5:44am Apr 18, 2007 5:44am
cesarnc,

you now only have long UJ right?

so your scenario is that jpy is the weakest currency with UJ bouncing soon?
  • #10,692
  • Apr 18, 2007 5:51am Apr 18, 2007 5:51am
This morning I read an interesting article by Jeff Greenblatt - Jeff does some original and accurate work on timing across many markets.

He says that Gold is now in a 3 day window where many cycles line up and allow change to happen (e.g. 233 days from its May top last year ) .....Gold hit an 11 month high at 690 in Hong Kong this morning.

The Dow is also in a time window - 55 calendar days since its Jan high - and at 12,830 is just below its February high.

The Dollar Index is also 55 days from its last high and close to its 2.618 extension at 81.33.

His windows of opportunity are normally +/- 1 day.

Cable often ( > 70% of the time ) makes weekly high & lows on Mondays and Fridays, so with little data out before the UK retail sales at 4:30 on Friday will it range until then? We dont know, but we´re going to find out soon.
Trading Levels with WRBs
  • #10,693
  • Apr 18, 2007 5:59am Apr 18, 2007 5:59am
Quoting CWH
2.51 EST : It's on its way down again. What's next????
2.0104 (early Europe high) is now a support level. Prop points below include 2.0089 (today's Asian session top), 2.0074 (yesterday"s peak), 2.0063 (today's Asian session base), 2.0035 and 2.0000. TP in the distance at 2.0510 - I'll lock in manually 1 lot at a time on the ascent. SL 2.0062.

http://www.tradingcentral.com/chart/...0418121118.GIF

Do not focus on making money; focus on protecting what you have.
  • #10,694
  • Apr 18, 2007 6:09am Apr 18, 2007 6:09am
Quoting BurgerKing
cesarnc,

you now only have long UJ right?

so your scenario is that jpy is the weakest currency with UJ bouncing soon?
Yes. UJ is at an interesting level to be bought

- right at an upwards trendline started at the bottom 115.14
- higher timeframes oversold, as well as USD across the board
- talks of bid interest at 118.50 area / offers at 119.00
- strong stocks favor carry trades - if NYC comes buying dollar then the intraday direction will be boosted by USD stronger/Yen weaker overlapping

This scenario is denied in the intraday at breach of 118.20 - bottom of Apr 13th

Further USD selloff causing GU new highs and UJ breaching 118.20/00 and I'll be clueless about the short term (days)
  • #10,695
  • Apr 18, 2007 6:10am Apr 18, 2007 6:10am
We should be looking for retracement to enter long
Check this From Bloomberg

Quote
The British pound, having broken above $2, is set to extend its rally in coming weeks to the strongest since 1981, as central-bank buying of the currency propels it higher, according to Brown Brothers Harriman & Co.

Central banks will purchase pounds sterling as they diversify their swelling foreign-exchange reserves away from the U.S. dollar and as speculation of higher interest rates in the U.K. boosts returns on pound-denominated investments, said Marc Chandler, head of currency strategy at Brown Brothers.
``There are several factors behind sterling's advance that still have some legs,'' New York-based Chandler wrote in a note to clients yesterday. Central banks ``continue to diversify reserves and sterling is a beneficiary of these flows.''
Quote
``The pound has further to go,'' said Paul Robson, a currency strategist at Royal Bank of Scotland Group Plc in London. ``These two reports today will lead people to speculate on the idea that we won't be seeing just one rate hike from the central bank."
Money: Bad Master, Best Slave
  • #10,696
  • Apr 18, 2007 6:16am Apr 18, 2007 6:16am
Quoting emurithi
We should be looking for retracement to enter long
Check this From Bloomberg
Thanks emutihi, I like this kind of info.

Market was talking that 5.5% (next hike) would be toppish. But with recent CPIs, there are talks of a possible 5.75% still this year.

Confirming hike + confirming new strong CPIs (implying inflation not contained) and 5.75% will get into play here.
  • #10,697
  • Apr 18, 2007 6:26am Apr 18, 2007 6:26am
Reprint from Money Week Article:

"We did say that the Bank of England should have raised interest rates this month - and we wonder if perhaps the Monetary Policy Committee is now wishing it had done just that.
News that consumer price inflation hit 3.1% in March meant that Mervyn King has had to write a letter to the Chancellor, explaining why inflation had breached the Bank’s target range, for the first time since the new measure and target were introduced. Meanwhile, retail price inflation hit 4.8%, its highest level since July 1991.
As regular readers know only too well - we’ve been saying it for quite some time now - inflation in this country and across the rest of the world is a lot more entrenched and much more of a risk than mainstream forecasters believe.
Not a single economic forecaster polled by Reuters before yesterday’s CPI data predicted that it would go as high as 3.1%.
And despite all the hullabaloo following the shock surge in March, we suspect that they’ll continue to underestimate inflation - until it’s far too late
Bank of England governor Mervyn King’s letter to the Chancellor on inflation read like an attempt to soothe Gordon Brown – and the rest of us – into thinking that everything is going to be OK. He argued that inflation would come down later in the year (something we’ve been hearing for a while now), as the impact of sharp gas and electricity price hikes falls out of the comparison figures.
In turn, Mr Brown’s cordial reply sounded like an attempt to soothe the electorate into thinking that nothing could go wrong and they should still vote for him. The rise in inflation was largely dismissed as part of a global phenomenon based on rising oil prices – nothing to worry about there, and certainly not a UK-specific problem.
But Michael Saunders at Citigroup pointed out the flaw in King’s argument. “Yes, inflation will fall back sharply at first, but this is not benign. We’re seeing a gradual rise in non-energy inflation which will pick up later in the year. I think it is conceivable that the Monetary Policy Committee will raise rates a half point in May.”
Mr Saunders has hit the nail on the head – the key problem is that the rise in inflation was fuelled by much more than just higher petrol prices or gas bills. We are now seeing price gains in the kinds of things that have up until very recently not really featured in the monthly release from National Statistics. Items like furniture, toys, clothes - deflation in these items, mostly imports from China, has been one of the main factors in keeping inflation down. But that seems to be at an end now.
And of course, as inflation just keeps rising – particularly when it breaches a high-profile target like this – people start to mutter about how their wages can keep up.
There’s an interesting little exchange in a BBC feature entitled “High inflation and you”. The piece is laid out in a question and answer format, explaining very simplistically what the leap in inflation means. One question is whether wages will have to rise. The answer from the man at the Beeb is “Yes, and it should be by more than 3.1%. Wages and benefits are pegged not to the Consumer Prices Index but the Retail Prices Index, which includes housing costs and currently grows by 4.8%.”
News that wages are pegged to anything will be a revelation to most employers - particularly Gordon Brown, who, in his reply to Mervyn King’s inflation letter, wrote that he was continuing to support the MPC in its “fight against inflation” and that “to that end, as I announced to Parliament in 1 March 2007 overall headline settlements for public sector workforces covered by Pay Review Bodies are to be less than the 2 per cent inflation target in 2007-08.”
So public sector workers can look forward to a real-terms pay cut of - currently - just under 3% this year? We are really looking forward to seeing how that one plays out with the unions - particularly as inflation isn’t just going to lie down and go away. Already nurses have backed calls to take industrial action unless the government improves on its 1.9% pay offer.
Elsewhere on the BBC site, Evan Davis on his blog, shows that the mainstream is finally waking up to the fact that inflation is a problem. He warns that if inflation persists “it would imply that interest rates had perhaps been ‘too low’, that the borrowing we have done on the back of low interest rates was less affordable than we thought, that the house prices we have paid on the back of easy borrowing are unsustainably high, and that any sense of consumer wealth deriving from higher house prices is a mere illusion.”
Phew! Couldn’t have summed it up better ourselves.
So what’s ahead for interest rates? A further hike in May is almost certain – the money markets are already pricing in a further hike to 5.75%. And as Edward Hadas on Breakingviews.com points out, “whispers of 6% by year-end are now starting to be heard. But while that would be the highest rate since 2001, it might not be enough. After all, 75 basis points of increase since last August seem to have done little. Once inflation is let loose, it is not easily tamed.”
We don’t disagree with him. But we’re betting that at the next hint of inflationary pressures easing, the markets will immediately dive back into complacency mode, and the talk of 6% will be relegated to the back benches again.
Don’t be fooled. Inflation may have just sprung its biggest surprise yet, but it won’t be the last - not by a long chalk."
  • #10,698
  • Apr 18, 2007 6:29am Apr 18, 2007 6:29am
Quoting Why Oh Why
2.0104 (early Europe high) is now a support level. Prop points below include 2.0089 (today's Asian session top), 2.0074 (yesterday"s peak), 2.0063 (today's Asian session base), 2.0035 and 2.0000. TP in the distance at 2.0510 - I'll lock in manually 1 lot at a time on the ascent. SL 2.0062.
Another 5 long. Same strategy.
Do not focus on making money; focus on protecting what you have.
  • #10,699
  • Apr 18, 2007 6:34am Apr 18, 2007 6:34am
Quoting wshhmm
the question at this level, 26 year high, who is the buyers.

after cable hits so high and just stay there, buyers lose momentum. also short are scary to short.

so cable now don't have any direction.

i think it might get some up with short suqeeze. but don't expect up more.
i agree with you mate
  • #10,700
  • Apr 18, 2007 6:58am Apr 18, 2007 6:58am
so how do you think, some profittaking or actually sellers start to enter?
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