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Reminiscences of A Forex Speculator

  • #301
  • Jul 7, 2011 10:45am Jul 7, 2011 10:45am
Quoting newyear498
Yale has an entire free course on Game Theory

http://oyc.yale.edu/economics
Thanks. I am going to take a look.
  • #302
  • Edited 7:00pm Jul 7, 2011 6:50pm | Edited 7:00pm
Quote
Interesting..you think it could be that switched on investors have already accepted the fact that things in the EZ are going to only get worst from here on, and would have opted to divert funds into other favorable investments?
Based off the EUR/USD's relative price action to other risk vehicle's, yes.

I've been thinking about the creditors too. They will not act until the EZ actually makes a decision on what to do with banks. Recent news suggest this won't be solved any time soon. They have shown that they are willing to keep playing the credit agencies games. The french idea fell flat, they have to go back to the drawing board. I don't think Greece will default any time soon.

NFP tomorrow will be important. The idea has been planted that the slowdown might be over. It just needs to materialize.

Greece and Dismal US news in a nutshell was what scared investors away in June. Those two situations are showing some signs of light. Treasury dealers expect their downtrend to continue.

Portugal looks like they might want to take some spotlight in the future, sucks to be euro.

Debt ceiling is around the corner too. Tax revenues going into the deal will dictate republican opposition. Unless democrats found 2 trillion dollars to slash somewhere. Fxlive noted obama calmed his rhetoric today.

Sounds like stuff investor stuff right? They make longer term trades so I wouldn't think they take all the small things into account. I remember that awesome video unamedplayr posted with the bank dealer and the long term trader. The long term trader said he simply ignores most of the day to day news. While the bank dealer changed his opinion multiple times through the day.
Cautiously optimistic. . .
  • #303
  • Jul 8, 2011 12:13am Jul 8, 2011 12:13am
Quoting Tact1cal
Based off the EUR/USD's relative price action to other risk vehicle's, yes.

I've been thinking about the creditors too. They will not act until the EZ actually makes a decision on what to do with banks. Recent news suggest this won't be solved any time soon. They have shown that they are willing to keep playing the credit agencies games. The french idea fell flat, they have to go back to the drawing board. I don't think Greece will default any time soon.
Indeed, but I can see the rift between the credit agencies and the EuroZone institutions beginning to get a bit widened, and that can't bode well for the currency. Greece may not default anytime soon, but I'm thinking that by mid-August/September when the Troika comes along to see if they're meeting their fiscal targets, the markets may finally realize that they are throwing good money after bad. Cut your losses short. Additionally, some of the creditors seem to have their own agenda, as some of the private bondholders have already sold off some of their 2014 bond holdings, (forget the source though) potentially leaving the EZ institutions and governments (taxpayers) with an even heftier burden than originally anticipated. All in all, it should be interesting to see how this plays out.

Quote
NFP tomorrow will be important. The idea has been planted that the slowdown might be over. It just needs to materialize.

Greece and Dismal US news in a nutshell was what scared investors away in June. Those two situations are showing some signs of light. Treasury dealers expect their downtrend to continue.
Could be the trigger for some risk on going into the next week, especially on the back of the rate hike.

Quote
Portugal looks like they might want to take some spotlight in the future, sucks to be euro.
I feel relly sorry for them actually..they seem to be the most resilient of the PIIGS.

Quote
Debt ceiling is around the corner too. Tax revenues going into the deal will dictate republican opposition. Unless democrats found 2 trillion dollars to slash somewhere. Fxlive noted obama calmed his rhetoric today.

Sounds like stuff investor stuff right? They make longer term trades so I wouldn't think they take all the small things into account.[b] I remember that awesome video unamedplayr posted with the bank dealer and the long term trader. The long term trader said he simply ignores most of the day to day news. While the bank dealer changed...
That was a class documentary.

Regards,
xXTrizzleXx
  • #304
  • Jul 8, 2011 12:21am Jul 8, 2011 12:21am
Yesterday was a bit of a messy day for me. I had opted to establish some short EUR/CHF and GBP/CHF positions, but in my preoccupation with the rates announcements, I had completely forgotten the event risk of ADP employment, and needless to say the large impact on USD/CHF smoked my stops effortlessly. Lesson learned!

I also wanted to establish a short position in XAU/USD, but when it didn't react as anticipated, I took the trade out at BE. I'm holding off on shorting this bad boy, and may even long it in August->September, on the back of increasing Asian demand, and mulling in Swiss Parliament as to whether or not it should be incorporated into a parallel currency. Far-off scenario I know, but these days, the shocking events are becoming terribly ordinary.

I also had a small AUD/USD position in, but it closed it out at BE since there was no real compelling momentum, especially ahead of NFP - speaking of which, I intend to play today on EUR/USD. Good luck to anyone else out there playing it.

Regards,
xXTrizzleXx
  • #305
  • Edited 3:48am Jul 8, 2011 3:36am | Edited 3:48am
I intend to play today on EUR/USD. Good luck to anyone else out there playing it.

Hi there
finally a thread worth the time, I am trading Eur Usd, from my observation point Eur Usd gained yesterday upon adp and ECB press while rate got higher to 1.50,
as also manipulation,,, but as we look macro Euro is in bad position portugal, not to mention geece,,, so I am assuming to see the further development....down ´´as Tact1cal mentioned´´
born to speculate
  • #306
  • Jul 8, 2011 12:29pm Jul 8, 2011 12:29pm
I must admit that I have not attempted to put on any trades based on this book, yet. However, as an Order Flow generator newbie, this book is great:

Currency Trading and Intermarket Analysis: How to Profit from the Shifting Currents in Global Markets by Ashraf Laidi.

Also, there is a thread in the Trading Discussion section that was started by Razorjack called "Identifying Market Swings - Medium and Long Term Trading." It was only active between Jan-Feb., 2010.

I haven't seen any references to it on the major Order Flow threads. I am giving it a read, and it definitely fits with Trizzle's longer term approach.
  • #307
  • Jul 8, 2011 6:22pm Jul 8, 2011 6:22pm
Quoting aligater
Hi there
finally a thread worth the time, I am trading Eur Usd, from my observation point Eur Usd gained yesterday upon adp and ECB press while rate got higher to 1.50,
as also manipulation,,, but as we look macro Euro is in bad position portugal, not to mention geece,,, so I am assuming to see the further development....down ´´as Tact1cal mentioned´´
Hope it went well for ya!

Quoting The Cheetah
I must admit that I have not attempted to put on any trades based on this book, yet. However, as an Order Flow generator newbie, this book is great:

Currency Trading and Intermarket Analysis: How to Profit from the Shifting Currents in Global Markets by Ashraf Laidi.
Definitely a nice little book to know how things interlock together - great recommendation. Unfortunately I've only skimmed it as I have other readings I'd like to get through first.

Quote
Also, there is a thread in the Trading Discussion section that was started by Razorjack called "Identifying Market Swings - Medium and Long Term Trading." It was only active between Jan-Feb., 2010.

I haven't seen any references to it on the major Order Flow threads. I am giving it a read, and it definitely fits with Trizzle's longer term approach.
Agree with you here, and that was one of the first threads I delved into when beginning to approach things from a longer term perspective..a very logical thread.

Regards,
xXTrizzleXx
  • #308
  • Jul 8, 2011 6:32pm Jul 8, 2011 6:32pm
Today I played my first live NFP on EUR/USD, going long initially, and taking profits at 1.4300, then shorting it at that level once my limit orders at 1.4350 had been just barely missed. I had a fair feeling price wasn't going to make it back there, so instead opted to short at 1.4300 and ride it down, taking risk off at 1.4240, and leaving a riskless short running to ride bearish sentiment in the pairing into next week. The timing of the short could have been improved, but I noted that this trade felt a tad uncomfortable because I had not been expecting such a low number, and I believe my distracted nature compromised my order placement...after going through that though, I'm sure other ones will fare better.

I also established a long position on USD/JPY, since from a structural perspective, the pair has piqued my interest...it will be interesting to see how it will play out next week.

I ended up closing my AUD/JPY position as well today, as the horrible NFP numbers signalled to me that a bout of risk aversion may have the potential to adversely affect my position. Looking back, this decision may have been a bit hasty...Wonder how next week will play out.

Regards,
xXTrizzleXx
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  • #309
  • Jul 9, 2011 4:47pm Jul 9, 2011 4:47pm
Wow! Those numbers SUCKED! LOL I wish I could have been around to trade it. I checked the numbers while I was driving and laughed out loud. This is pretty damaging for bullish sentiment. I'm going to have to do a lot of planning for next week. Good luck with your positions!


Quote
Indeed, but I can see the rift between the credit agencies and the EuroZone institutions beginning to get a bit widened, and that can't bode well for the currency. Greece may not default anytime soon, but I'm thinking that by mid-August/September when the Troika comes along to see if they're meeting their fiscal targets, the markets may finally realize that they are throwing good money after bad....
Awesome thinking! I'll have to look into the of the intentions of private creditors. That completely flew over me. Excellent feedback Trizzle.


Since we're all sharing information. Anyone ever read this thread? One of my all time favorites.
Cautiously optimistic. . .
  • #310
  • Jul 10, 2011 8:02pm Jul 10, 2011 8:02pm
Quoting xXTrizzleXx
Fellow traders,



Regards,
xXTrizzleXx

Nice thread

btw. MT4 Mobil has 30 indicators and it can be installed in devices with windows 6.5 or latter and Dukascopy's platform for Iphone can handle indicators as well.
  • #311
  • Jul 11, 2011 10:03am Jul 11, 2011 10:03am
Quoting Tact1cal
Wow! Those numbers SUCKED! LOL I wish I could have been around to trade it. I checked the numbers while I was driving and laughed out loud. This is pretty damaging for bullish sentiment. I'm going to have to do a lot of planning for next week. Good luck with your positions!
Indeed..I actually stood there for a while trying to get various sources thinking that they left out an extra 0!


Quote
Since we're all sharing information. Anyone ever read this thread? One of my all time favorites.
Never knew the great wizard had his own! Definitely going to take a closer look.

Quoting rac
Nice thread

btw. MT4 Mobil has 30 indicators and it can be installed in devices with windows 6.5 or latter and Dukascopy's platform for Iphone can handle indicators as well.
Thanks man, but I've reached a stage where I can get by without them.

Regards,
xXTrizzleXx
  • #312
  • Jul 11, 2011 9:28pm Jul 11, 2011 9:28pm
So I returned home after my month abroad, and unfortunately it will result in updates to the journal being a bit more spaced out than they are currently. Perhaps a weekly/biweekly analysis and summary of my positions.

I started the weak on a rather sour note..I had a position in EUR/USD in anticipation of bearish sentiment this week, with its stop at 1.4300..nowhere on my price feed or any others that I checked did price hit 1.4300, and it turns out it magically got stopped out? Seeing as the market dropped to 1.4000 today I was a little stirred, but opted to just try to get some positions in on EUR/CHF and EUR/USD even though I feel like I missed the majority of the move..at least they're risk free for now. I'm glad I closed out my USD/JPY position on a retrace to entry, since I wasn't feeling particularly confident in the pairing having upside potential. I can't help but see 79.50 being targetted..will be interesting to see the action unfold in this usually inactive pair this week.
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  • #313
  • Jul 12, 2011 4:37am Jul 12, 2011 4:37am
Quoting xXTrizzleXx
So I returned home after my month abroad, and unfortunately it will result in updates to the journal being a bit more spaced out than they are currently. Perhaps a weekly/biweekly analysis and summary of my positions.

I started the weak on a rather sour note..I had a position in EUR/USD in anticipation of bearish sentiment this week, with its stop at 1.4300..nowhere on my price feed or any others that I checked did price hit 1.4300, and it turns out it magically got stopped out?
very good attitude , many pips are on table.
cheers
aligater
born to speculate
  • #314
  • Jul 12, 2011 5:16am Jul 12, 2011 5:16am
Quoting xXTrizzleXx
So I returned home after my month abroad, and unfortunately it will result in updates to the journal being a bit more spaced out than they are currently. Perhaps a weekly/biweekly analysis and summary of my positions.

I started the weak on a rather sour note..I had a position in EUR/USD in anticipation of bearish sentiment this week, with its stop at 1.4300..nowhere on my price feed or any others that I checked did price hit 1.4300, and it turns out it magically got stopped out? Seeing as the market dropped to 1.4000 today I was a little stirred,...
Trizzle, sounds like a total wound up plan.
For the stop out. Oanda had a real high opening this week. Check out the feed in there.

I have been short from 4160 ..not a good entry inspite of my bearish view from Thrusday conference onwards.
Hopefully Bernake does something useless in his testimony.
  • #315
  • Jul 12, 2011 6:29am Jul 12, 2011 6:29am
Yes indeed, you have an amazing attitude, to still be able to make profitable trades after such a misadventure, hats off to you.

On oanda the high on Sunday open was 1.42983. I guess that spike up in illiquid trading was another hint of what was about to happen to the euro this week with brokers, dealers whatsoever trying to close out as many shorts as possible before the crash?
  • #316
  • Jul 13, 2011 7:20pm Jul 13, 2011 7:20pm
Thanks guys, that reassurance was quite what I needed, especially since I've been feeling a little bit off lately, maybe it's because I've been on the wrong side of the volatility. Hopefully I'll be able to have a good little sit back and think about the possible implications of the various events going on to help position myself better.

There was a time way back in May when I was particularly interested in USD/JPY breaching 79.50, and now that it has, I see the very real possibility of JPY intervention in the near future.

Events I'm watching are the EZ debt crisis and Debt Ceiling talks as they carry on. Today the dollar got pummelled, and the JPY could see a safe haven bid if the Italian Bond Auction today does not proceed well, and subsequently, if an alarming number of banks fail the stress tests on Friday. Goes without saying I'm playing this short EUR/CHF and short USD/JPY as well. The latter more because I get the feeling the specs want to bait BoJ into intervening...timing will be everything with that trade, but if they do..it will be free money in the pot, and possibly my best trade ever! I'm going to be really cautious around 76-75.

Regards,
xXTrizzleXx
  • #317
  • Jul 14, 2011 11:17am Jul 14, 2011 11:17am
Quoting xXTrizzleXx
Thanks guys, that reassurance was quite what I needed, especially since I've been feeling a little bit off lately, maybe it's because I've been on the wrong side of the volatility. Hopefully I'll be able to have a good little sit back and think about the possible implications of the various events going on to help position myself better.
That certainly doesn't feel good. My experience tells me that it's best to take a time out for the day, a few days or a week and wait a) the markets to calm down a bit and b) for one to clear up one's mind. You've shown some real skill previously and I'm sure it's just the politicians messing around rather than your analytical capabilities that are doing the damage.

Quoting xXTrizzleXx
There was a time way back in May when I was particularly interested in USD/JPY breaching 79.50, and now that it has, I see the very real possibility of JPY intervention in the near future.
It's a topic that never gets old when USDJPY goes below a certain level but I just can't see the Japanese intervening this time around, not until the yen reaches 75 or below. Unilateral interventions don't work and I'm sure the BOJ knows that. Last time around, just after the earthquake, it managed to convince G7 CBs to come and help but that was a natural disaster. This time around it's just free market forces doing their thing. So if they intervene, they are going to have to do it alone and that certainly doesn't help.

What's more, even if they do intervene, I can't see that having any impact other than a intraday spike. The US dollar is at record lows against NZD and CHF while remaining very weak against EUR, CAD, JPY, AUD etc. The yen has benefited from the recent calamities in Europe and the US, but it still hasn't managed to reach record highs. I think we will see a new record before the BOJ even

Furthermore, an intervention has to have a good reason. When the BOJ intervened last year (Summer/Fall) the Japanese companies were facing potential losses due to exchange rate differences that they had not managed to hedge. Right now Japan is set to benefit from a stronger yen due to rebuilding efforts which require large amounts of natural resources (not found in adundance in Japan in case anyone is wondering). Also, I would venture to guess that Japanese exporting companies used the opportunity in late March/early April to do some proper hedging.

In short I would expect to see any fireworks before 75. Noda and the rest of the officials will no doubt 'be watching closely' but so will traders looking to push the yen to record highs.

Quoting xXTrizzleXx
Events I'm watching are the EZ debt crisis and Debt Ceiling talks as they carry on. Today the dollar got pummelled, and the JPY could see a safe haven bid if the Italian Bond Auction today does not proceed well, and subsequently, if an alarming number of banks fail the stress tests on Friday. Goes without saying I'm playing this short EUR/CHF and short USD/JPY as well. The latter more because I get the feeling the specs want to bait BoJ into intervening...timing will be everything with that trade, but if they do..it will be free money in the pot,...
I did some trading in the aftermath of the earthquake and tsunami and it wasn't all that fun. I made a killing by fading the move down in EURJPY (riding the elevator up with the BOJ) but later lost it all and then some during the European session. The European session was much more liquid and intervention attempts were faded. I put in a long position only to see it crash a short while later. In my foolishness I didn't use a stop thinking the ECB would ride to the rescue. Well it did, but about a half an hour too late for me. The take-away point here is to use a stop and be on guard while trading with or against a central bank.

EZ crisis...debt ceiling 'debate'... so much BS and so little substance. What a pity. It looks to me that it has reached a point where it doesn't matter what the news is because the market is so volatile that even a position taken in the right direction will get taken out if not careful.
If you don't risk, you don't ever have to lose.
  • #318
  • Jul 14, 2011 2:55pm Jul 14, 2011 2:55pm
Quoting bug
That certainly doesn't feel good. My experience tells me that it's best to take a time out for the day, a few days or a week and wait a) the markets to calm down a bit and b) for one to clear up one's mind. You've shown some real skill previously and I'm sure it's just the politicians messing around rather than your analytical capabilities that are doing the damage.
Heya bug, good to see you around these parts! Thanks for that. Yeah the headline whipsawing is a real killer, but I can't say I don't love the volatility! Things look set to get even tenser as July draws to a close...going to have to get very picky with my opportunities.


Quote
It's a topic that never gets old when USDJPY goes below a certain level but I just can't see the Japanese intervening this time around, not until the yen reaches 75 or below. Unilateral interventions don't work and I'm sure the BOJ knows that. Last time around, just after the earthquake, it managed to convince G7 CBs to come and help but that was a natural disaster. This time around it's just free market forces doing their thing. So if they intervene, they are going to have to do it alone and that certainly doesn't help.

What's more, even if they...
I actually agree with everything you have mentioned here. The plan was to get a risk-free short on USD/JPY and let it run until 75/76, at which point I'd start looking to fade the downward spikes, as I can see some quick profit emanating from that if done carefully. The hindrance in my plan was the random 100+ pip spike last nite that effortlessly smoked my stop before coming back down. I get the feeling that this is going to make JPY longs that much more cautious meaning the down-move may take longer than I anticipated, and since my margin gets tied up so fast, it may be worthwhile to invest it in other areas with quicker turnover. Like you mentioned, I'm also noticing the change in rhetoric of the MoF to favoring a stronger Yen in the coming weeks, and have even read of multinationals like Toyota revamping their production schedules to favor domestic production since exporting at these levels is becoming uneconomical. Will be interesting to see how this plays out.

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I did some trading in the aftermath of the earthquake and tsunami and it wasn't all that fun. I made a killing by fading the move down in EURJPY (riding the elevator up with the BOJ) but later lost it all and then some during the European session. The European session was much more liquid and intervention attempts were faded. I put in a long position only to see it crash a short while later. In my foolishness I didn't use a stop thinking the ECB would ride to the rescue. Well it did, but about a half an hour too late for me. The take-away point...
Ah I remember this trade, although I was on demo at the time, and also remember being disappointed by the ECB and Fed's performance on the intervention. But it was some pretty easy money..timing is key...

Quote
EZ crisis...debt ceiling 'debate'... so much BS and so little substance. What a pity. It looks to me that it has reached a point where it doesn't matter what the news is because the market is so volatile that even a position taken in the right direction will get taken out if not careful.
I'm putting it off as simply traders who are looking for excuses to trade. Most of the action during the day isn't enough to grab my attention..it's when things get quiet into the Tokyo handover that it gets interesting...

________________

For now I am:
Short 1 x EUR/CHF 1.1745
Short 1 x EUR/USD 1.4180

in anticipation of any movement at all that may be generated by the bank stress tests tomorrow, or any blunder EZ officials may make. Given the recent naughtyness of the market I've ensured that these positions have risk taken off already. I'm also wondering whether I should limit the amount of 'legs' I put on so that I may have margin left over to take advantage of short-term opportunities. Going to have to think about this..I did discover that I can get a whole lot more (from 5% down to 3%) margin by switching my account from CAD to USD. Since I don't really trade the CAD pairs, I'm wondering if this would be a wise move. Playing some poker to pass the time.

Good luck out there,
xXTrizzleXx
  • #319
  • Jul 14, 2011 3:33pm Jul 14, 2011 3:33pm
Quoting xXTrizzleXx
The hindrance in my plan was the random 100+ pip spike last nite that effortlessly smoked my stop before coming back down. I get the feeling that this is going to make JPY longs that much more cautious meaning the down-move may take longer than I anticipated, and since my margin gets tied up so fast, it may be worthwhile to invest it in other areas with quicker turnover.
These spikes are not helping, you are right about that. But then again, this is nothing new in the capital markets. Strong hands > weak hands. Spikes like this are to be expected whenever USDJPY goes below 79 as entities such as Kampo (and other Japanese companies) and international banks look to initiate JPY shorts or cover their exposure. There was some info on today's spike over at forexlive which to me sounded pretty convincing. Then again, who am I to tell?

USD/JPY sits at 79.00, up from around 78.70 when I sat down. Inbetween we had a horrendous spike to 79.55/60 just as European traders were taking off their coats followed by an instantaneous sell-off. Not surprisingly given the speed of the rally, rumours the BOJ had intervened soon circulated. Seems they hadn’t.
Rather the blame for the spike was put on the shoulders of a US commercial bank and to a lesser extent a large Japanese bank and a UK clearer. Talk is they combined to execute a very large corporate order, but I’m not sure we’ll ever know exactly what went on.
Suffice it to say once it became clear it wasn’t the BOJ in open market down we came and since then it’s been narrow range bound trade in the pairing. Talk of sizeable sell stops now through 78.40.
http://www.forexlive.com/blog/2011/0...ppy-covers-it/

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I'm putting it off as simply traders who are looking for excuses to trade. Most of the action during the day isn't enough to grab my attention..it's when things get quiet into the Tokyo handover that it gets interesting...
I've been mixing up my sleep sessions the last couple of days and I've had the opportunity to trade the Asian session. Absolutely crazy! But also very fun if you're on the right side.
If you don't risk, you don't ever have to lose.
  • #320
  • Jul 15, 2011 12:43pm Jul 15, 2011 12:43pm
Quoting bug
These spikes are not helping, you are right about that. But then again, this is nothing new in the capital markets. Strong hands > weak hands. Spikes like this are to be expected whenever USDJPY goes below 79 as entities such as Kampo (and other Japanese companies) and international banks look to initiate JPY shorts or cover their exposure. There was some info on today's spike over at forexlive which to me sounded pretty convincing. Then again, who am I to tell?
[indent][i]USD/JPY sits at 79.00, up from around 78.70 when I sat down. Inbetween...
Looks like S&P had it in for my EUR/USD position taking it out on a spike upwards! Oh you rating agencies...

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I've been mixing up my sleep sessions the last couple of days and I've had the opportunity to trade the Asian session. Absolutely crazy! But also very fun if you're on the right side.
Oh trust me I feel you on the sleep cycle distortions! But if it puts food on the table...

Regards,
xXTrizzleXx
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