Cable Update (GBPUSD)

I know you don't mind when I do. See you tomorrow.

AAAAH, the Cloggy...

Watch these guys Videos, very interesting... They Believe the US is headed to anarchy, or rather, the Dollar!

Decoupling Now, Currency Crisis Soon

NIA believes that the decoupling we have been predicting of precious metals from the Dow Jones has now officially taken place. A year ago we would consistently see precious metals and stock market prices rise and fall in parallel. We have now seen the Dow Jones decline by 6.1% from its high on August 9th, along with both gold and silver rising by about 3.3% during this same time period.

The Dow Jones to gold ratio is now down to 8.1, near its low for 2010 of 7.9. The gold to silver ratio still remains at a historically high level of 66. However, silver was up today by $0.65 to $19.03 per ounce, its biggest one day gain since early June. We expect silver to significantly outperform gold in the months to come.

One year ago, almost all mainstream economists on CNBC were calling for either a "U" or a "V" shaped economic recovery. NIA said that prices were rising only due to inflation and there would be no economic recovery. NIA went into detail about how destructive government programs like the homebuyers tax credit were helping to artificially boost economic numbers, but as soon as these programs were over, economic activity would collapse to new lows. NIA was right. Now that the government has ended its homebuyers tax credit, we just saw sales of previously owned homes decline in July by 25.5% from one year ago, to their lowest level in a decade. We also saw new home sales in July based on the signing of new contracts decline by 32.4% from one year ago.

The government will report their second estimate of second quarter GDP on Friday and we will likely see a revision from growth of 2.4% down to growth of less than 2%. Keep in mind, the White House budget is projecting a GDP growth rate of 5.58% over the next five years (along with permanently low interest rates) in order to get the budget deficit down to $752 billion in 2015. With a sharp contraction in GDP likely coming in the third quarter, NIA continues to believe that the Federal Reserve will unleash the mother of all quantitative easing this fall, along with a huge push by Congress for a new stimulus plan.

U.S. mutual funds currently have about $10.5 trillion in assets, with $2.5 trillion being in bonds and $4.6 trillion being in equities. Although the amount of money invested in equities is still far greater than bonds, asset inflows into bonds have outpaced equities for 30 consecutive months. During these 30 months, $559 billion were invested into bond funds while $209.4 billion were pulled out of equity funds. It is a real shame that most retiring baby boomers who are looking for safety, are actually investing their savings into the riskiest assets of all.

The U.S. savings rate climbed in June to 6.4%, its highest level in one year. It is unfortunate that Americans who are doing the right thing by increasing their savings, are simply giving their savings away for free to the government which is spending it recklessly with no way of paying it back. When this bond bubble begins to burst, prices of commodities will explode to the upside like nothing you have ever seen before.

NIA believes that there is a risk of the bond bubble beginning to burst as early as this fall. Smart money is now loading up on commodities. In the week ended August 17th, net long holdings in futures for 20 commodities rose 2.6% to 1.18 million contracts, with the biggest rises coming in agricultural commodities like wheat and corn. Commodity assets under management gained by about $8 billion in July to over $300 billion.

The World Gold Council just announced today that gold demand surged in the second quarter of 2010 to 1,050.3 metric tons, up 36% from one year ago. This rise in demand came mostly from rising investment demand, with gold demand for backing ETFs climbing 414% and retail investment demand rising by 29%.

Because the rest of the world still likes to follow and emulate the U.S., it might be Americans who initiate the upcoming stampede out of bonds, U.S. dollars and other dollar-denominated assets, and into precious metals. For the time being, the average American is still more likely to be a seller of gold. Recycling of gold increased 35% last quarter to 496 metric tons. Once Americans become educated about how gold isn't expensive and is still trading for only 1/2 of its all time high adjusted to the CPI and 1/4 of its all time high adjusted to the real rate of price inflation, and that by recycling gold they are actually trading real money for fiat paper money, this recycling supply will diminish and the world will face a major gold shortage. The world already has a major silver shortage that will become apparent to all very soon.

NIA's co-founders still receive phone calls on a daily basis from non-NIA member friends asking for us to invest in Real Estate "short sales" and other foreclosure deals. By year 2012, NIA guarantees nobody is going to want to touch Real Estate and all of your friends will be calling you about the latest Krugerrand that they bought. Although NIA doesn't project hyperinflation to occur until the years 2014-2015, there is a serious risk of hyperinflation occurring any day now. Hedge funds need to be where the momentum is and as soon as the momentum turns against the dollar, we could see the bond bubble burst and the currency crisis begin instantaneously.

Please spread the word about NIA and have your friends and family subscribe for free at: http://inflation.us

That dark cloud.... what was the subject again?!?...

Plz don't miss interpret me guys, I'll soon feel sad...

I'm not bashing people whit opinion and appreciate others compgany here.
If not, why would I be here.

All I'm saying, is that if newbs like to make mistake and play the happy trigger then let them be, no use for any of us to bash them to the end.
Teaching is good for the one that like to learn. Its like a drug addic at an AA meating. If he dosen't want to quit then its no use....

Take care all!

I wholeheartedly agree with you, however I came down rather hard on Joemiami's case as he portrayed himself as a CTA managing 4 million trading FX futures, his calls and lack of understanding of the basics made me dig a little deeper and I called him out as a noob, which he finally agreed to being.

My reasoning for doing so was twofold, one he portrayed himself as a commercial CTA so he really has no business being here and he should be banned to the commercial section only, but that is up to Twee (something he disappointedly rarely does) and two I wanted to highlight his lack of experience so that other "newer" traders would not see and follow his rather silly calls as he made himself out to be a "professional"

I wasn't bashing him for being a noob, I was bashing him for being a fraud. I know that is a strong word to call someone, however anyone that claims to have a series 3, manage a FX futures fund of 4 million and then finally admits that he is just a noob, I can't think of a better word to describe him.

Still holding this long i will feel much better if it get pass 1.5515 then i have comfirmation it's going to 1.5700 area, im happy at the moment tho, wish all luck

hi Clogg,
appreciate you're looking out for us newbies. i must say though..after a while and lots of readings, we kinda know who to follow. nevertheless, grateful to have experience trader like you helping and guiding us. Thank You.

To set the record, straight, Im a noob at FX, Ive done just a few Fx futures trades for my clients but mainly stick to ES bcuz thats what bread and butter is....end of story.

But you are right in that I shouldn't post trades on here for my lack of expertise in FX and don't want other noobs to assume that Im a pro at it, which for the record, I am not.

Best Regards

Welcome to the asylum buddy, there are some good nuggets of info to pick up here in between the waffle.

Nothing wrong with posting trade setups here and posting charts, all part of the debate. I just picked on you a bit for some of your other CTA related posts, but that is by the by.

There are some d@rn fine traders stopping by here that help out with views on Cable from all sorts of methods and viewpoints.

BTW Malcolm and Kill are the big es traders here, off the top of my head.

We hit my target so I am done for the day.

we can stay above red line..should go up..with a bit of good fortune

I do find it better trading longer term now. For starters it teaches you patience. Once I have found a setup, I create an order with 3 runners and I will have TP already set for the first two runners. I have to create 3 separate orders for each trade but once set I can then forget and I don't have to keep my eyes glued to the charts. I manage the third runner with a trailing stop.

Instead of trading one or two pairs, I now scan 20 pairs, but concentrate on the major pairs for setups.

Swing and position trading suits me because I do have a full-time job and I cannot focus on my trades every minute of every day, which you need to when day trading!

You can see it in the charts!

Copper has a better correlation with the S&P / Dow Jones now, but it is a metal that is very much used in industry, whereas gold and silver rather less so. Check the copper chart and compare it with ES or DJ.

I'll try to apply the principle of C-R-S in the early AM
and avoid hitting the big ball before the little one.

You playing this weekend?

Dr. D.

Pips always available no matter how you look at the charts.

Dr. D.

Maby you just need to make your corner a little more round sometimes?! LOL

I understand that very well and all this make sens.
And I also need to say that I appreciate your analysis.

Take care!
Cya at London (music!)

What's with the GBP going up? The DOW is flat. Any news?

been making higher lows and highr highs since london open yesterday , little pop at rollover put it back above last weeks low , could be some weak shorts booking their trades now

Lol, have seen corn grow faster than this trade has progressed , didnt quite trigger limit orders on 1st tgt but took profit manually , have left a few runners on but not looking too promising at the moment, cheers all

I will get my trade because I based it on daily S/R, that is swing highs and swing lows

I do not use any indicators, they are a waste of time. Just basic support and resistance areas. Identify them correctly and keep collecting.

In my previous posts I did mention about 200 ema, but that was just because someone on this forum, suggested it was good for SR, but now I feel I can abandon that too.

I think we have a nice move for 100 Pips