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GU, GJ and EU Analysis Thread

  • #181
  • Jul 13, 2010 9:49am Jul 13, 2010 9:49am
Quoting Stocky Monk
Nice post mate...Interesting

Stocky
...appreciation, always appreciated.

Today, pff, Cable, Cable, Cable - she can open a whole can of whoopass within minutes. Stopped out earlier, and now reviewing direction.

I've been telling myself for ages that I should start taking some shorter-term trades - basically, 09:15 GMT direction... particularly if it agrees with the 4hr Guppy profile. Today was not really one of those days, as the 4hr profile is compacting on the red MAs, with no real reversal of these at present. However, the daily could be argued to have shown the initial turn for a run north, with a retracement yesterday that was timed nicely for the rebound off the red MA twist come news release this morning. Much prefer to take entries on retracements that, kissing an increasingly spreading red MA profile, head off agina in the same direction as the red MAs.

Today was what I have been observing for some time. Price is marked down prior to news release, and then bang, off London go in the opposite direction. Of course, one has to bear in mind the Frankfurt fake out - my statistical analysis suggests a reversal upon such moves for approximately 80% of the time. Yes, I am guilty of, when being in a positive trade in the direction of Frankfurt open, thinking that that trade will fall into the 20% bracket.... SL always to break-even if, in the morning, trade is positive and London yet to open.

Tomorrow should be interesting. I think I will see if the US/Asia sessions pull price back somewhat, and watch what Frankfurt do tomorrow morning prior to the UK claimant count change. If news is good, I think a push up to the 1.54 region that I have mentioned several times before, may not be so far off. Yes, I know, I was postulating upon a drop to the 1.47 region a day or so ago. But as we all know, in such times, prediction is fraught with divergence.
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  • #182
  • Jul 13, 2010 10:59am Jul 13, 2010 10:59am
July 13 (Reuters) - The European Central Bank drained 200.9 billion euros of overnight cash from euro zone money markets on Tuesday, paying depositing banks an average interest rate of 0.76 percent on funds parked at the ECB.
Tuesday is the last day of the ECB's latest reserve maintenance period. Banks often have a surplus of overnight funds at this point in the cycle, pushing the ECB to temporarily drain cash out of the system.
A total of 158 banks bid to deposit funds requesting between 0.5 and 1.0 percent in interest.

The operation was done the same day as the ECB's weekly attempt to take 7-day deposits from banks to offset the inflationary impact of its controversial government bond buying programme introduced in May.

The amount of liquidity in the euro zone banking system remains historically high but has more than halved since banks repaid back 442 billion euros of ECB one-year loans at the start of the month.
The average interest rate paid to participating banks compares with a rate of 0.25 percent that they would normally receive from the ECB on overnight deposits.

Stocky
  • #183
  • Jul 13, 2010 11:04am Jul 13, 2010 11:04am
Reuters

Euro recovers after Greece's debt auction results...

Greece successfully tapped capital markets for the first time since late April.


Thought these bits of news data might be of interest to some.

Stocky
  • #184
  • Jul 13, 2010 12:48pm Jul 13, 2010 12:48pm
Time to post a thank you from me, too, to 45Condor. I always read your posts. Interesting and refreshing, sometimes thought provoking. Wish I had more time to post my reaction, really.
Gone to a better place
  • #185
  • Jul 13, 2010 11:22pm Jul 13, 2010 11:22pm
Quoting Stocky Monk
EJ has finally traded down 110.84 and tested the daily channel resistance as support.

There is an decending hourly channel also which looks like a flag pattern for the bigger 4hour picture... I would be careful selling the top of this channel again as bounce of 110.84 has has strong momentum behind it which is visble from the spread of the up bars....110.84 may provide the spring board needed to get price upto 113.14.

Obviously the strong GU upmove from this morning CPI figures has taken Euro/USD with it today and also E/J so a close eye on...
Good day to you,

Just popping in to congratulate you on the above analysis. Solid!

Very, very well done!

My highest regards
  • #186
  • Jul 14, 2010 1:25am Jul 14, 2010 1:25am
Hey guys, how is everyone?

I came on FF to check a few things out I am working on for a project (related to sentiment) and saw Stocky had left a pm in my inbox inviting me here. What happened to the old thread?

Apologies for my abrupt absence, things have been crazy here. First up almost all of my trading time and effort has gone into the September FFI contract. The leverage is more rational, the % moves are far greater, trading costs are much much lower and with BP being the way they are I saw an opportunity to do all of my intraday trading in FFI.

The results have been spectacular if I do say so myself, I managed to ride the GBP down for most of the trend and then hopped on the FTSE just as the BP rough ride was really getting started. I kept expecting to wake up find all my contracts underwater after a huge "bailout of BP" announcement or something, but it never came and the FFIU0 shorts just kept piling up!

I have included a % chart here to show how BP has made it easy and mostly risk free to capitalise on FTSE underperformance:
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Anyway, a couple of weeks ago a medium size broker-dealer here in Melbourne collapsed (Sonray) leaving 3000 accounts frozen and ~$30mio AUD in unsecured creditors. Having examine the PDS for my various brokerage accounts, they all seem to suffer from the same issue: supposedly segregated money is pooled into an omnibus account with everyone elses. Interactive Brokers is supposed to be insured for $30 million per account but I have a feeling insurance would be useless in a full on financial blowout the likes of which have already taken out AIG! I especially remember when RefCo collapsed in the US all their Spot FX trader-clients basically got raped.

So, while I escaped from this collapse unharmed as I was not with that particular broker, my trading volume has decreased dramatically as I moved the majority of my marginable capital out of all my broker accounts to keep it safe while I look for another with a more sane PDS.

My advice to all is to check their broker PDS carefully. It seems almost every single retail broker does the same thing and in the event of systemic blowout you might find it very difficult to redeem any funds or exit any open positions!

It's not all bad news though. Having removed most of my capital, prepared my various financial year statements for the taxman, and noticing the strong downtrend in FFI was broken (with GBPUSD already rallying towards 1.5) I decided to take my first little holiday since EURUSD was at 1.5 and since the beginning of this financial year I have been lazing about and just checking EOD charts to keep an eye on things.

I am unsure about the GBP currently, I have just been monitoring the USDX daily to make sure I don't miss anything important.

Hope to join the great traders back here very very soon, as soon as I figure out who the hell I can execute with. Might be time to open a dukascopy account.

GMAE
  • #187
  • Jul 14, 2010 3:11am Jul 14, 2010 3:11am
Quoting TauTrader
Good day to you,

Just popping in to congratulate you on the above analysis. Solid!

Very, very well done!

My highest regards
Hi Tau,

Thanks for the kind words.

Stocky
  • #188
  • Jul 14, 2010 3:20am Jul 14, 2010 3:20am
Quoting sinner-
Hey guys, how is everyone?

I came on FF to check a few things out I am working on for a project (related to sentiment) and saw Stocky had left a pm in my inbox inviting me here. What happened to the old thread?

Apologies for my abrupt absence, things have been crazy here. First up almost all of my trading time and effort has gone into the September FFI contract. The leverage is more rational, the % moves are far greater, trading costs are much much lower and with BP being the way they are I saw an opportunity to do all of my intraday trading...
Hi Sinner,

Welcome to the new thread....The old one was closed down by Twee after DT decided to go commercial and offer signal services for a fee...Nothing wrong with that but hes limited to the commercial section only now. Few other reasons aswell but we wont go into that..lol

Anyway glad you have been busy.....The FTSE has made some lovely moves so glad you got on them....

Look forward to seeing your posts on here, even if they are for a Future contract like the FTSE...I for one dont mind seeing whats happening in stocks intraday. It can all help with the bigger picture when trading FX.

Stocky
  • #189
  • Jul 14, 2010 3:28am Jul 14, 2010 3:28am
Timing nicely to hit some major fibs as the news comes out. Also about to try and burst the major magenta TL. Maybe most expect rejection, and are already short in order, just for Cable to bust through, come back to TL, and then head off north again.
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  • #190
  • Jul 14, 2010 3:34am Jul 14, 2010 3:34am
If it was not for the red MAs having twisted to head north, I would have perhaps taken a short at the kiss of the descending magenta TL. However, I am cautious today... especially after having my posterior handed to me yesterday.
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  • #191
  • Jul 14, 2010 4:03am Jul 14, 2010 4:03am
Quoting Stocky Monk
Hi Sinner,

Welcome to the new thread....The old one was closed down by Twee after DT decided to go commercial and offer signal services for a fee...Nothing wrong with that but hes limited to the commercial section only now. Few other reasons aswell but we wont go into that..lol
Drama drama huh. That's a shame. I liked that thread a lot.

Quote
Anyway glad you have been busy.....The FTSE has made some lovely moves so glad you got on them....

Look forward to seeing your posts on here, even if they are for a Future contract like the FTSE...I for one dont mind seeing whats happening in stocks intraday. It can all help with the bigger picture when trading FX.

Stocky

It's been unbelievable mate, if only my broker would let me borrow some BP shares I would have shorted them directly.

How about an intraday short from 135.5 for GBPJPY with a stop at 136? I don't have much capital left in any accounts so this will literally be a 1 lot mini for me. Upthrust above yesterdays high followed by a no-demand on the M15. Short from the low of the no-demand.
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  • #192
  • Jul 14, 2010 4:38am Jul 14, 2010 4:38am
EJ, GU and EU all at major dailly or weekly resistance.

Yesterdays push up has us testing major weekly and doliy resistance levels on all 3 pairs.

GU is facing numerous resistance levels...Daily decending channel Res, 5315 monthly inside bar setup break level, monthly level 5471 slightly higher up. Last weeks VSA signals show a topping pattern around 5230 and also indicating supply entering up here. On that bases I wouldnt discount yesterday as possible stop clearer for short or price being pushed higher of the CPI figures to be sold into before a strong downmove.

Give the mass of resistance above us im going to be looking for some low volume tests before looking for shorts...A break of 5315 monthly inside bar setup and I will be looking for medium term longs with 5780 and 6075 as targets. In the mean time im scalping both direction of key intraday levels and VSA signal.

EJ reached 113.15 after bouncing of 110.84. Strong resitance between 113.15 and 114.15...Again low volume test of this area on the 4hr and I will be shorting but a steady break through the area with VSA confirming demand I will be looking at 118.84 as a medium term target or the top of the daily channel.

EU again has been very bullish intraday since the beginning of June. I have attached a weekly chart as it is easier to see the potential areas for a bounce lower. I am very bearish on the Euro fundementally and technically. I think we are going for a 38.2 fib of the weekly drop which is at 3120. There are 1 or 2 weekly TL just before that which may provide enough resisatnce for us to bounce lower and test 1.18 again...

All round I think today will be slow given the strength of yesterdays move and where we are at the moment. 1.30 US figures may provide some movement but the US will probably be waiting for the FOMC minutes later this evening.

Stocky
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  • #193
  • Jul 14, 2010 5:01am Jul 14, 2010 5:01am
Quoting sinner-
Drama drama huh. That's a shame. I liked that thread a lot.



It's been unbelievable mate, if only my broker would let me borrow some BP shares I would have shorted them directly.

How about an intraday short from 135.5 for GBPJPY with a stop at 136? I don't have much capital left in any accounts so this will literally be a 1 lot mini for me. Upthrust above yesterdays high followed by a no-demand on the M15. Short from the low of the no-demand.
Had some news on BP via reuters yesterday suggesting they have finally contained the spill...may see a rise in there shares slightly but long term its a can of worms I would say with a mountain of lawsuits sitting on there doorstep.

Anyway nice trade on the GBP/JPY...I took the same trade on E/J ...Ive stayed away from geppy over the last month or 2 due to its wild chop/ whips. E/J seems to give simlar setups and behaves much better.

Attached the EJ chart....

glad to see someone else using VSA aswell...

Stocky
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  • #194
  • Jul 14, 2010 5:19am Jul 14, 2010 5:19am
Quoting Stocky Monk
Had some news on BP via reuters yesterday suggesting they have finally contained the spill...may see a rise in there shares slightly but long term its a can of worms I would say with a mountain of lawsuits sitting on there doorstep.
Nah I reckon we are approaching the "too f'd to short" area for BP, if they get nationalised or bought out by a competitor (there are rumours Obama has ok'd this idea) anyone holding borrowed stocks trying to cover their shorts might have to pay a hefty premium on such news.

Quote
Anyway nice trade on the GBP/JPY...I took the same trade on E/J ...Ive stayed away from geppy over the last month or 2 due to its wild chop/ whips. E/J seems to give simlar setups and behaves much better.
Stocky

Fundy wise it probably makes more sense and cause less stress to short EUR/JPY - especially with slightly better than expected GBP numbers today but I picked GBP/JPY watching todays PA on the M15, there was a strong supply during Tokyo right into the MR1 (smart money in Tokyo trying to frontrun a big train?) and the attempt to break above during London surely failed (at least so far) with that upthrust.

Having gone back over the PA in GBP and FTSE over the last few days it is possible someone big from outside the UK is exiting a huge GBP hedge on a FTSE position? Look at the open for both today, pound straight up FTSE straight down.

I am very very glad to see others seeing the same thing as me, although I have a feeling I am about to get cooked with that last M15 bar, while we remain above the London and Frankfurt open prices.

Love your work as usual Stocky.
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  • #195
  • Jul 14, 2010 5:58am Jul 14, 2010 5:58am
Quoting sinner-

I am very very glad to see others seeing the same thing as me, although I have a feeling I am about to get cooked with that last M15 bar, while we remain above the London and Frankfurt open prices.
I exited my E/J short at 112.67 ....previous 4hr swing high resistance now support. Will re-consider entering once this level has been broken.

EJ and GJ have made a lower highs on the 15 min so looks promising if you are still in short. I have G/J in a small channel. May see momentum pick up if we break out the highlight wedge.

Stocky
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  • #196
  • Jul 14, 2010 6:23am Jul 14, 2010 6:23am
Quoting Stocky Monk
I exited my E/J short at 112.67 ....previous 4hr swing high resistance now support. Will re-consider entering once this level has been broken.

EJ and GJ have made a lower highs on the 15 min so looks promising if you are still in short. I have G/J in a small channel. May see momentum pick up if we break out the highlight wedge.

Stocky
Are you reading my mind or something? London open level is being a pest, I took measly profits (after spot spreads, commission and converting my JPY to AUD!) there after it was obvious a bit of demand still lingering (hence invalidating my no-demand analysis). 40AUD or something. Think I might just go back on holidays until I can talk to dukas.

GMAE.
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  • #197
  • Edited 9:11am Jul 14, 2010 8:10am | Edited 9:11am
Quoting sinner-
Are you reading my mind or something? London open level is being a pest, I took measly profits (after spot spreads, commission and converting my JPY to AUD!) there after it was obvious a bit of demand still lingering (hence invalidating my no-demand analysis). 40AUD or something. Think I might just go back on holidays until I can talk to dukas.

GMAE.
lol..mind reader....thats my other profession...

US figures gave us a nice spike up on EJ and GU....

GU 4hr has formed a Pinbar at R1 also daily/weekly resistance zone....US figures spiked us up to 38.2 retrace of the Pinbar...I have entered short at 5246 with stop above the high of the Pinbar. May of got in early on this but will see how this one plays out. A break and hold below 5230 confirms down move...may add further shorts there.

EJ short 112.60 also.....111.86/90 first target 50%fib zone of yesterdays rise.

Stocky
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  • #198
  • Jul 14, 2010 9:08am Jul 14, 2010 9:08am
Quoting Stocky Monk
lol..mind reader....thats my other profession...

US figures gave us a nice spike up on EJ and GU....

GU 4hr has formed a Pinbar at R1 also daily/weekly resistance zone....US figures spiked us up to 38.2 retrace of the Pinbar...I have entered short at 5246 with stop above the high of the Pinbar. May of got in early on this but will see how this one plays out. A break and hold below 5230 confirms down move...may add further shorts there.

EJ short 112.60 also.....118.86/90 first target 50%fib zone...
closed EJ short at 112.08 (+52)

GU shorts still running. Looking a little shakey at the moment...5230 proving tough to break....this is a 4hr setup so will hold for now.

Stocky
  • #199
  • Jul 14, 2010 11:40am Jul 14, 2010 11:40am
I see that interest rate hikes are being touted again, and with it, interest in Sterling.

BOE member David Miles does not see a need for a hike, as he does not see a rise in inflation to be on the horizon. Quite the contrary, actually, he and his ilk predict a drop. Well, I have previously written at length about how other, well-informed analysts, state that the true rate of inflation to be higher than published. CPI and core CPI are regarded by many to be in a controlled state of manipulation.

Miles notes that while inflation is currently ‘uncomfortably’ high, the latest inflation figures suggest it is ‘slightly’ moving back towards the target level of 2%. He also goes on to say that about a year ago it was below 1%. Well, yes, for obvious reasons, old boy. It is reported that minutes from the last BOE meeting revealed that members noted a ‘possibility’ of further increases in the UK CPI – which rose 3.4% on the year in May – but that sharp downward moves are more ‘likely’. Well, maybe, as people tighten the belts again and the banks place their money in government coffers each night as opposed to Bob the builder’s account. But to use uncomfortably, slightly, possibility and likely, are not encouraging to hear from an institution that the public are expected to regard as stalwarts of monetary study.

I am uncomfortably appreciating the slightly troubling possibility that is likely that you lot don’t know what they hell is going on.

Well, maybe BOE member Andrew Sentance does, and his call for a 25 basis points hike was a veiled message to big money of the state of things to come. That is, economic growth in the UK is going nowhere, fast, and so the only way to help UKPLC out of the mess down at the treasury, is to entice big money in, and make a profit from a slice of the carry trading that will come with this. Let’s face it, with a purported hidden public sector debt of some £4 trillion, and on the whole, discouraging employment figures (part-time work does not constitute a stable base from which the public are going to hit the high streets), UKPLC has to do something to make big money interested.
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  • #200
  • Jul 14, 2010 12:26pm Jul 14, 2010 12:26pm
I read on the grapevine that French and German banks are trying to pressure Switzerland into not sticking so rigidly to the Basel II Accord… how banks are measured and monitored. I seem to recall that the second accord basically allowed banks to do away with reserve requirements, which led to the huge credits and debits that ultimately resulted in the trouble that we now find ourselves in. So, what we have is the two creditors for Europe – bitterly resentful of each other in general – working together to try and convince/badger Switzerland into cooking the books so that the real state of the banks is not revealed come the results of the stress tests. Hmm, more of the same corruption so expected from Europe.

Meanwhile, in other news, German authorities today raided the offices of Credit Suisse in an operation to reveal tax avoiding clients.

As if hypocrisy could not become more compounded, it is revealed that EuroLand’s sovereign rescue fund is to be headed by a German, Klaus Regling, operated in Luxembourg - and hence inside a tax haven - but expects triple A credit rating once inaugurated. It is reported that many investors question the attainment of triple A, citing that only a minority of EuroLand’s members backing the fund have a triple A rating. The riposte from Klaus Regling was that specific measures had been taken to ensure the fund was awarded a top credit rating. Ah…

There is a “general commitment from euro area countries to do whatever else is needed to get the best possible rating.” Said Klaus Regling, and that, “I am confident that we will get the best possible rating, maybe some time in August,” he opined, before stating, “I think the point that 16 finance ministers of mature economies promise to do whatever is necessary to get the best rating is worth a lot.”

Reggie, my man, they can’t really promise anything else, can they? I mean, look at the news coming out of Spain today regarding bankrupt councils and lack of pay. The breakdown at local level is up and running. Your fund is not going to trickle down to the man on the street, just the high-street banks… which, incidentally, are being forced to accept take over in Spain and Germany by larger banks, and whose debt is not going to show on the stress test results, I suspect.

What is quite telling is that Klaus Regling points out that governments will be able to borrow from the facility if they agree to adopt reform programmes designed by the International Monetary Fund, European Commission and European Central Bank. Oh dear, more pain for the man on the street.

The fund is going to be used to shore up ailing banks, according to Reggie, although governments can draw on the fund for bank recapitalisation. “It does not mean there is an ATM machine. Everyone agrees that countries only get money when they accept conditionality.” Stated Klaus Regling. He also revealed that, “We will be ready to act whenever the politicians tell us to act.” Of course…

…hey man, double standards suck.
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