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Silent Service Method

  • #8,041
  • Apr 14, 2010 10:45am Apr 14, 2010 10:45am
Noticed the uSD/jPY has crossed over a significant 50% Fibo at least five times in the last week, forming a Box Pattern, reflecting indecision in the market and a lot of un/loading trades. Gold is coincidentally flirting with key level $1162/oz..

Oil inventories came in lower for the U.S. today. There are many tankers in the Arabias and the Asiatics offshore - fully loaded - waiting to ship. So "contango" is definitely at play in the Futures market. CAD is likely going to further strengthen against the USD until more supply is tapped. Dow rising, leaving some on-the-table with natural resources considerably outperforming retail stocks...
Attached Image(s) (click to enlarge)
Click to Enlarge Name: uSD:jPY Daily.jpg Size: 91 KB
Click to Enlarge Name: uSD:jPY 3H.jpg Size: 81 KB
  • #8,042
  • Apr 14, 2010 10:52am Apr 14, 2010 10:52am
Quoting TraderDavo
Its relative strength.

What he is really doing is being LONG the cad (because its strong all around) and short the yen (because it is really bad right now - they have the worst GDP to debt ratio of any developed country in the world).

Think of it this way: Canada is strong, US is sitting in the middle, Japan is falling apart.
Nice explanation, thanks.
Position trader - Anything intraweek is just noise...
  • #8,043
  • Apr 14, 2010 10:56am Apr 14, 2010 10:56am
Quoting Arfer Daily
Chris, do you see any conflict in being short usdsgd and usdcad but long usdjpy? I can see how they all could possibly work out but it seems strange to be trading usd in both directions!
I know what you mean - but truthfully....it comes down to why the USD is moving one way or another.

The SGD is moving because of the Sing Bank allowing it to appreciate more....its a pegged currency in a "zone".

The CAD is all about oil right now.

The USD JPY is about the fact that JPY is in long term trouble, and risk coming back into favor.

Someone else is talking about CAD/JPY - that is about oil as well. Oil goes up, so does the CAD.....and Japan imports 100% of it's oil.
  • #8,044
  • Apr 14, 2010 10:57am Apr 14, 2010 10:57am
Chris, I apologize for speaking for you in your own thread!
  • #8,045
  • Apr 14, 2010 10:57am Apr 14, 2010 10:57am
What would you do with this, close it or keep it? That looks bound to retrace but could go further down. The trouble is that the resistance level is good to hide the stop behind but it's a bit wide, where else would you put the stop? At the end of the day I'm happy with the 100 pips I've got locked in even though it's nearly 200 pips up as we speak. Tough call and something I'm yet to get my head round fully with this method of trading.
Attached Image (click to enlarge)
Click to Enlarge Name: usdsgd.gif Size: 30 KB
Position trader - Anything intraweek is just noise...
  • #8,046
  • Apr 14, 2010 10:58am Apr 14, 2010 10:58am
Quoting clockwork71
I know what you mean - but truthfully....it comes down to why the USD is moving one way or another.

The SGD is moving because of the Sing Bank allowing it to appreciate more....its a pegged currency in a "zone".

The CAD is all about oil right now.

The USD JPY is about the fact that JPY is in long term trouble, and risk coming back into favor.

Someone else is talking about CAD/JPY - that is about oil as well. Oil goes up, so does the CAD.....and Japan imports 100% of it's oil.
Got it, thanks!
Position trader - Anything intraweek is just noise...
  • #8,047
  • Apr 14, 2010 11:20am Apr 14, 2010 11:20am
Quoting Arfer Daily
SINGAPORE—Singapore's central bank tightened monetary policy aggressively Wednesday to cool an economy that posted the fastest growth on record in the first quarter and faces rising inflationary risks.

Read it and weep suckers! LOL

I'm only joking, I wasn't expecting this either but I went to bed at more or less break even and woke up 150 pips up. The dilemma now is whether to hold on to the trade and see if it continues to trend down or take profit after an unexpectedly large move which is quite likely to retrace? There's no 4 hour resistance...
Well done on that trade!
  • #8,048
  • Apr 14, 2010 11:24am Apr 14, 2010 11:24am
Quoting o990l6mh
Well done on that trade!
Lol, thanks. A bit lucky though I'd be the first to admit.
Position trader - Anything intraweek is just noise...
  • #8,049
  • Edited 1:17pm Apr 14, 2010 12:39pm | Edited 1:17pm
Quoting Arfer Daily
What would you do with this, close it or keep it? ...
* Unfortunately I don't get that pair on my MB Trading MT4 platform but do on Oanda, whose charts only go back one-year, so I can't vouch for the placement of the fibs attached below in conjunction with any time further back than one-year. Of course the point is to be practical and show you a "little trick" I use when price moves entirely out of the Fib range, such as what happened on the uSD/sGD chart.

So I already have the normal Fib plot from the swing high/low in place, now for that little trick I use to project accurate and well-spaced Fib plots from there is to place anew Fibo between either the 23.6 & 0% - if price is going-down or between the 61.8 & 100% - if price is going-up and through.

Obviously it went down and through in this case. So to illustrate, the yellow Fib is the little trick fib, with its respective levels. The olive colored, larger Fib is the normal (swing high/low) plot; both of which are highlighted as you can see.

Simplistic I realize but it offers a little more to work than otherwise, and I tell you, it's valid market structure. There are orders at those levels that big money also sees and uses. I've seen it time and again.

Another thing to keep in mind on-a-fundamental-level is that Central Banks are well aware China will be allowing its currency to be revalued over the next couple years or so. Right along with the rest of the world, Singapore wants to get positioned for that shift ahead of time and I believe that's a significant reason why they appreciated their currency at-this-time. Other Central Banks in the region will likely follow suit, too. So in that light, you may want to consider your current Short a prime opportunity to hold as a long-term Position, not just a Swing trade - using technicals to navigate it.

** Speaking of technicals, I didn't mark it on the Daily chart; there's a nice Bear Flag formation starting round the tops of late October and the bottoms in later November drawn-out to present. You see it? A classic continuation pattern for a downtrend...

And I agree with the gang, good trade, either way!
Attached Image(s) (click to enlarge)
Click to Enlarge Name: uSD_sGD_Daily___Modified_Fib.png Size: 37 KB
Click to Enlarge Name: uSD_sGD_3H___Modified_Fibo_.png Size: 40 KB
  • #8,050
  • Apr 14, 2010 1:41pm Apr 14, 2010 1:41pm
"Perhaps the greatest shortcoming in traditional trader education is that it is heavily skewed toward explicit learning. Seminars, web site articles, books, and magazines are explicit by their very nature. These produce a knowing about the markets and trading, but cannot possibly generate the market feel that we observe among expert traders. Drilling [practice!] to the point of implicit learning is the missing ingredient in most traders' development." ~ pg. 124, Enhancing Trader Performance, B. Steenbarger
  • #8,051
  • Apr 14, 2010 2:15pm Apr 14, 2010 2:15pm
Quoting Soca
"Perhaps the greatest shortcoming in traditional trader education is that it is heavily skewed toward explicit learning. Seminars, web site articles, books, and magazines are explicit by their very nature. These produce a knowing about the markets and trading, but cannot possibly generate the market feel that we observe among expert traders. Drilling [practice!] to the point of implicit learning is the missing ingredient in most traders' development." ~ pg. 124, Enhancing Trader Performance, B. Steenbarger
Don't take offense, but what is the point of this quote? Isn't this guy's entire business model about selling books & seminars to traders? Seems to me like a very good argument to skip out on Dr. Steenbarger & (even more so) Mark Douglas' psycho-drivel books/seminars...

Did you mean to post this on a different thread?
  • #8,052
  • Apr 14, 2010 2:15pm Apr 14, 2010 2:15pm
Hats off to the corvette kid!
Position trader - Anything intraweek is just noise...
  • #8,053
  • Apr 14, 2010 2:24pm Apr 14, 2010 2:24pm
Quoting TraderDavo
Chris, I apologize for speaking for you in your own thread!

No worries Davo!
  • #8,054
  • Apr 14, 2010 3:34pm Apr 14, 2010 3:34pm
Quoting InfinitySL
Don't take offense...
Thanks for the feedback. You made a case for why that quote shouldn't be here; now make one for why it should if you would, please.
  • #8,055
  • Apr 14, 2010 4:33pm Apr 14, 2010 4:33pm
Quoting Arfer Daily
I have trouble logging on with the mobile trading.

Maybe I've misinterpreted your situation then? Presumably you must be out of the office for days at a time?
No, I am out of the office for hours at a time, not days at a time.

It sounds to me like you disagree with my philosophy of placing profit targets, and general trade/risk management.
  • #8,056
  • Apr 14, 2010 4:39pm Apr 14, 2010 4:39pm
Quoting Soca
Thanks for the feedback. You made a case for why that quote shouldn't be here; now make one for why it should if you would, please.
Not sure why I would want to make a case for that quote, as I have a very low opinion of "trader psychologists". The only reason I brought it up is that the quote is a bit self-defeating for the speaker of said quote. He's making a case for me not to buy his book or go to his seminar -- Done & Done.

In any case, rather than get off on a tangent and further clutter up this already very long thread, if you want a full download of my opinion feel free to PM me.
  • #8,057
  • Apr 14, 2010 4:39pm Apr 14, 2010 4:39pm
Quoting Arfer Daily
What would you do with this, close it or keep it? That looks bound to retrace but could go further down. The trouble is that the resistance level is good to hide the stop behind but it's a bit wide, where else would you put the stop? At the end of the day I'm happy with the 100 pips I've got locked in even though it's nearly 200 pips up as we speak. Tough call and something I'm yet to get my head round fully with this method of trading.
"...first thing is that no matter how hard you watch that screen you can't move the market by willpower and the second thing is that stop losses are there for a reason... Place the trade, set your stop then GO FOR A BEER! The market will still be there when you get back and seeing as these trends take days, weeks, even months to unfold you've got a little time til anything happens yet..."
  • #8,058
  • Apr 14, 2010 4:48pm Apr 14, 2010 4:48pm
Quoting InfinitySL
Not sure why I would want to make a case for that quote, as I have a very low opinion of "trader psychologists". The only reason I brought it up is that the quote is a bit self-defeating for the speaker of said quote. He's making a case for me not to buy his book or go to his seminar -- Done & Done.

In any case, rather than get off on a tangent and further clutter up this already very long thread, if you want a full download of my opinion feel free to PM me.
Actually he is not making a case for not buying books or attending seminars. He is making a case for the fact that you cannot simply read books and attend seminars and expect to become an accomplished trader. He is saying that the best way to become an accomplished trader is to practice what you learn via books and seminars by practice trading and drilling.
  • #8,059
  • Apr 14, 2010 6:52pm Apr 14, 2010 6:52pm
Hey guys,

Been away from the thread for a few weeks due to trading constraints but thought I'd drop in and say hi!

What do you guys think of the EUR/USD? A potential range breakout trade do you think?

The short is perhaps slightly stifled by a resistance line 50 pips away at 1.35 although it might just blast through that if it's more Greece news driving it but a long has some potential too. What's your thoughts?
  • #8,060
  • Apr 14, 2010 6:54pm Apr 14, 2010 6:54pm
Quoting o990l6mh
Short usdsgd? I'm not seeing that setup on my charts. Looking at the daily I'd be biased the other direction if any. (My crystal ball is known to not be that well polished though )
Hey Magnus, that ball definitely needs a shine!

What's the news driving Singaporean strength today?
Edit: Just read Arfer's post But surely if they are trying to cool their economy they don't want a strengthening currency, which is what happened?
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