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  • #421
  • Aug 16, 2011 10:16am Aug 16, 2011 10:16am
Ok down to the trades I've been up to recently. First off, with the Fed pledging a low-interest rate for an extended period of time, it would to me incentivize investors to go out and seek risk when the appetite normalizes. To this end I've decided to initiate a macro position on USD/INR to take advantage of the carry. It's the highest yield pair on my platform I believe, and the charts alone sing a song of yield. It's a trade I envision happening over a monthly time-span.
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  • #422
  • Aug 16, 2011 10:23am Aug 16, 2011 10:23am
Next on the list are some NZD positions - I'm trying to scale into a long NZD/JPY position as well as a short EUR/NZD position, and these are really sentiment and fundamental trades, as recently I've been developing a very positive feeling/outlook for NZD, and look forward to them removing their emergency interest rate cut if things aren't so dire in the growth prospects department. In these positions I'm short JPY and EUR for the situations in these countries respectively.
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  • #423
  • Aug 16, 2011 10:33am Aug 16, 2011 10:33am
I also have a risk free EUR/CHF because of the Franco-German meeting slated later today, which I've read the market was getting too overly excited about, and could be disappointed, as well as the SNB coming up without the slated peg that there is so much speculation about. If either of these scenarios fails to materialize, my stop should be quickly smoked, but with risk at 0 and a very good potential reward, I don't see why not!

AUD/USD was a short-term play which I decided to let one leg run after booking 3 out of 4 contracts. (I set my trades into 4 contracts, 2 are taking off at R/R 1:1 for a BE trade, and I can let the other two run, or book profit on one to appease uncertainty). Initially, I did have a risk-free short on this pair from last week, but decided to close it out before my stop was hit when the incessant Asians kept bidding up the market.
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  • #424
  • Aug 16, 2011 10:36am Aug 16, 2011 10:36am
And finally, there was a trade I wanted to take on EUR/USD, but it looks like my level was shot through due to various news reports. Luckily I had good stop placement around 1.45, and so decided to kill the trade on a retrace to entry. I may regret the decision later, but it's just too much draw-down for a short-term play for my liking.

Regards,
xXTrizzleXx
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  • #425
  • Edited 2:54pm Aug 16, 2011 2:29pm | Edited 2:54pm
Quoting xXTrizzleXx
And if the deflation fear materializes, then the markets would breathe a sigh of relief as the Fed would have amassed enough firepower to reach into its bag and begin a third LSAP program, QE3.
I highly doubt it. The Fed got a lot of flack for QE2 and their internal discussion has also been somewhat critical of QE. Long story short from the stuff that I've read I get the feeling that if the Fed feels the need to ease they will use something that hasn't been used up to now. Bernanke is an intelligent man and he (and his team) will come up with something, although I have to say that intelligence and good intentions don't guarantee a good outcome. US bond purchases have removed a lot of quality collateral from the market and I doubt the Fed wants to go down that road again.

Nice trades you (and newyear) got there.

BTW, what are those UFO like things on some of your charts (on the last EU chart near 4280)?
If you don't risk, you don't ever have to lose.
  • #426
  • Aug 16, 2011 2:50pm Aug 16, 2011 2:50pm
Quoting bug
I highly doubt it. The Fed got a lot of flack for QE2 and their internal discussion has also been somewhat critical of QE. Long story short from the stuff that I've read I get the feeling that if the Fed feels the need to ease they will use something that hasn't been used up to now. Bernanke is an intelligent man and he (and his team) will come up with something, although I have to say that intelligence and good intentions don't guarantee a good income. US bond purchases have removed a lot of quality collateral from the market and I doubt...
Hmm..they have alluded to having several 'tools' which they can use..would be interesting to see what they can pull out of the trusty toolbox to ease. In my recent reading of the Sowell econ text, it's kinda eye-opening that policy intentions and policy outcomes unfortunately can be complete opposites of each other. (assuming you meant outome and not income)

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Nice trades you (and newyear) got there.

BTW, what are those UFO like things on some of your charts (on the last EU chart near 4280)?
Thanks man That's my mouse changing image as I hit screen capture..must remember to move it off the screen! Hope your blotter's safe with all this zig-zag!

Regards,
xXTrizzleXx
  • #427
  • Aug 16, 2011 3:00pm Aug 16, 2011 3:00pm
Quoting xXTrizzleXx
Hmm..they have alluded to having several 'tools' which they can use..would be interesting to see what they can pull out of the trusty toolbox to ease. In my recent reading of the Sowell econ text, it's kinda eye-opening that policy intentions and policy outcomes unfortunately can be complete opposites of each other. (assuming you meant outome and not income)
To supplement that I would encourage you to listen to Mr. Meltzer's interview on EconTalk. Alan Meltzer is a Fed historian who has written two books on the history of the Fed. I just listened to one his interviews again and it was very enlightening, I especially enjoyed the part when he talked about what the Fed focuses on (short or medium term) and the implications for it today. I can tell you one thing, it didn't make my any more optimistic. But that's all I'm going to say, Mr. Meltzer does the explaining far better than I can. The interview I'm referring to is the one on the bottom: http://www.econtalk.org/archives/_fe...allan_meltzer/

Thanks for pointing out the income/outcome grammar mistake. My post was still open for editing so I fixed it.
If you don't risk, you don't ever have to lose.
  • #428
  • Aug 16, 2011 3:12pm Aug 16, 2011 3:12pm
I really like the idea of the ruby play... considering one myself now
  • #429
  • Aug 17, 2011 9:32am Aug 17, 2011 9:32am
Swiss Government announcing a press briefing today at an undisclosed time to discuss subjects it did not specify ROFL
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  • #430
  • Aug 17, 2011 12:17pm Aug 17, 2011 12:17pm
Quoting xXTrizzleXx
Ok down to the trades I've been up to recently. First off, with the Fed pledging a low-interest rate for an extended period of time, it would to me incentivize investors to go out and seek risk when the appetite normalizes. To this end I've decided to initiate a macro position on USD/INR to take advantage of the carry. It's the highest yield pair on my platform I believe, and the charts alone sing a song of yield. It's a trade I envision happening over a monthly time-span.
Well, trizzle I hope you dont use close stops. RBI is notorious for interving in the market. They intervene almost daily, one of the reasons I dont trade my own currency
  • #431
  • Aug 17, 2011 1:30pm Aug 17, 2011 1:30pm
Quoting newyear498
Swiss Government announcing a press briefing today at an undisclosed time to discuss subjects it did not specify ROFL
Nice catch! This goes to show that it pays to watch the wires when trading. Did you manage to rake this thing on the downside as well?
If you don't risk, you don't ever have to lose.
  • #432
  • Aug 17, 2011 1:36pm Aug 17, 2011 1:36pm
Quoting bug
Nice catch! This goes to show that it pays to watch the wires when trading. Did you manage to rake this thing on the downside as well?
No this trade ended up being poorly managed.. I closed one for small gain and the other hit my breakeven shortly after.. was more volatile then I expected.

My general thinking is usually after big moves things don't come down right away.. they either continue up or stall out.. am I right or wrong with this thinking.. maybe, maybe not.. but thats how I think.

This is one of those cases where it closed the gap in a short period of time.. today looked beautiful when I started trading.. but the markets changed from trending to ranging during my trading hours and I never adjusted.. so all day I got wiped
  • #433
  • Aug 17, 2011 2:03pm Aug 17, 2011 2:03pm
Quoting newyear498
No this trade ended up being poorly managed.. I closed one for small gain and the other hit my breakeven shortly after.. was more volatile then I expected.

My general thinking is usually after big moves things don't come down right away.. they either continue up or stall out.. am I right or wrong with this thinking.. maybe, maybe not.. but thats how I think.

This is one of those cases where it closed the gap in a short period of time.. today looked beautiful when I started trading.. but the markets changed from trending to ranging during my trading...
Sorry to hear that.

On a more lighter not, you can always blame the SNB for announcing a press conference and not coming up with something worthy of one. After all, that's why the market sold off. Everyone's been scared of the SNB pegging, but now that it turns out their full of hot air the market is ready to buy the Swissie again.
If you don't risk, you don't ever have to lose.
  • #434
  • Aug 17, 2011 5:47pm Aug 17, 2011 5:47pm
I actually missed the initial slide by a couple minutes. I had an alarm set to go off as I expected the stops above .8000 to get hit before the SNB took action to provide me with a nice entry as I was expecting some disappointment. Well, my plan couldn't have been more perfect. The only problem? The alarm didn't wake me up til minutes after the slide! LOL.

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My general thinking is usually after big moves things don't come down right away.. they either continue up or stall out.. am I right or wrong with this thinking.. maybe, maybe not.. but thats how I think.
Just a personal opinion. . .

The market was pricing in the expectation of an extreme outcome. A euro peg, a floor, something crazy. In fact these rumors were the only thing the CHF was responding to for a couple days. Economic numbers were almost completely ignored on the CHF. When the SNB came out and disappointed, everyone who was speculating on extreme outcomes had to cover their exposure. Once the Government announced the conference it was clear what the market wanted to price in. They wanted to government to announce some crazy shit. All the Government said was that they were behind the SNB and did not deliver on speculative expectations. Everyone had to cover their positions AGAIN. The market will never price in deviation from expectation slowly. Especially when people are trying to cover exposure.

Amazing price action on the CHF. I was drooling all over this at work but I can't babysit a position there. . .
Cautiously optimistic. . .
  • #435
  • Aug 17, 2011 6:53pm Aug 17, 2011 6:53pm
Quoting Tact1cal
Just a personal opinion. . .

The market was pricing in the expectation of an extreme outcome. A euro peg, a floor, something crazy. In fact these rumors were the only thing the CHF was responding to for a couple days. Economic numbers were almost completely ignored on the CHF. When the SNB came out and disappointed, everyone who was speculating on extreme outcomes had to cover their exposure. Once the Government announced the conference it was clear what the market wanted to price in. They wanted to government to announce some crazy shit. All...
Tact1cal,

This is more than a personal opinion, this is good analysis!

I am in Los Angeles visiting my family so I am a bit out of the loop. I am going to get back at it tomorrow, but it looks like I'll have some work to do to catch up with the market's sentiment.

Glad to see that some of you were able to catch some good trades.
  • #436
  • Aug 17, 2011 9:38pm Aug 17, 2011 9:38pm
Quote
This is more than a personal opinion, this is good analysis!

Cool, glad you can appreciate it. I had been watching this setup since last week. It can take a while for expectations to build up, but it only takes a sentence to crush them all.

Great journal btw. I'm a slow poster so I try to limit myself for time sake but I've been enjoying it, the introspection is great.
Cautiously optimistic. . .
  • #437
  • Aug 18, 2011 3:32am Aug 18, 2011 3:32am
Quoting The Cheetah
Tact1cal,

This is more than a personal opinion, this is good analysis!
+1
If you don't risk, you don't ever have to lose.
  • #438
  • Aug 19, 2011 6:34am Aug 19, 2011 6:34am
Here are some of the news stories that have caught my eye over the previous few days. I'm busy modifying a trading strategy so I don't have much time to comment.

USA
Fisher: Enormous risks to doing more Fed easing; could hurt inflation expectations
In other news: U.S. Annual Inflation Rate at 3.6% in July
Europe:
Fed Eyes European Banks: Regulators Scrutinize Ability of Institutions' U.S. Units to Fund Themselves
Switzerland:
Gold and the SNB
On the SNB, Once more

Fun:
http://www.spiegel.de/international/...99-248215.html
If you don't risk, you don't ever have to lose.
  • #439
  • Aug 19, 2011 12:06pm Aug 19, 2011 12:06pm
With the recent market volatility and a general flight to liquid and quality assets a lot of traders have been waiting for the Japanese officials to return to the 'crime scene' by intervening again. There has been no shortage of commentators who think the Japanese failed in their intervention efforts. But, as I explained in one of my previous posts, I don't think the intervention has failed at all (see here). The MOF's announcement seems to confirm my analysis - that they are not intervening to weaken the yen per se, but only to provide Japanese exporters opportunities to hedge and/or trade at attractive levels. Of course, they will never tell it like it is. Instead, they prefer to remain mysterious lest their real motives be exposed.

From the WSJ:

the government has no plans to start a sustained intervention campaign to steer the yen to specific levels but will nevertheless take "appropriate action" when it is deemed necessary.

Mr. Nakao said that "we don't have plans to intervene often." He added: "We don't use intervention as a daily tool."

When it is deemed necessary = when the end of the quarter is nearing or has just passed and it appears that corporations have failed to make correct estimations of the movements in the yen rate.

Full story: Japanese Official: Yen Doesn't Reflect Economic Fundamentals

China
The real estate boom in China is nothing new and I'm sure most of you have read quite a few articles about it. If you're still hungry for more, here's some more:
China’s Empty Apartments: PART 1, PART 2
If you don't risk, you don't ever have to lose.
  • #440
  • Aug 19, 2011 12:24pm Aug 19, 2011 12:24pm
Quoting bug
With the recent market volatility and a general flight to liquid and quality assets a lot of traders have been waiting for the Japanese officials to return to the 'crime scene' by intervening again. There has been no shortage of commentators who think the Japanese failed in their intervention efforts. But, as I explained in one of my previous posts, I don't think the intervention has failed at all (see here). The MOF's announcement seems to confirm my analysis - that...
tell you what.. if they step in I'll fade the move.. thats my game plan
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