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EurAnalysis Kindergarten 24 replies

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EurAnalysis

  • #12,441
  • Nov 29, 2011 5:22am Nov 29, 2011 5:22am
Quoting lovepips
nice 25 pips in the bag and a trailing stop.....may even get 30 pips :-)
+31pips :-)
patience is a virtue
  • #12,442
  • Nov 29, 2011 5:24am Nov 29, 2011 5:24am
Quoting FXMindset
IIRC ?
If I Recall Correctly
Those who say it cannot be done should not interrupt those who are doing it
  • #12,443
  • Nov 29, 2011 5:26am Nov 29, 2011 5:26am
Quoting FXMindset
IIRC ?
Sorry, I forgot about some of the language barriers on this international forum here.

It's internet short hand for "If I recall correctly"

Add: PT beat me too it.
I don't care which way the market is going as long as it's going my way
  • #12,444
  • Nov 29, 2011 5:27am Nov 29, 2011 5:27am
Quoting PipTrapper
Here is the latest ECB ad-hoc communique related to the SMP (Securities Market Program).

Last week the total net outstanding amount was 194.5 Billion and it has now increased to 203.5 billion euros.

This is what I call closet QE/Intervention

if I understand it correctly, ECB bought 203.5 billions EUR? Or it was buying "something" worth of 203.5 billions, like bonds, for instance? It is interesting because it may help gauge the impact of these intervention. For instance, a 200+ billions (of what? EUR? bonds?) ECB intervention amounts for 80-100 pips up for EUR/USD.

I know it's very simplistic, but at least it's something that may be calculated somehow.
  • #12,445
  • Nov 29, 2011 5:27am Nov 29, 2011 5:27am
Quoting PipTrapper
If I Recall Correctly
Thanks
If there was easy money lying around,no one would be forcing it into your
  • #12,446
  • Nov 29, 2011 5:28am Nov 29, 2011 5:28am
Quoting PipKiller
Sorry, I forgot about some of the language barriers on this international forum here.

It's internet short hand for "If I recall correctly"

Add: PT beat me too it.
Thank you too
If there was easy money lying around,no one would be forcing it into your
  • #12,447
  • Nov 29, 2011 5:33am Nov 29, 2011 5:33am
Quoting michaelnew
if I understand it correctly, ECB bought 203.5 billions EUR? Or it was buying "something" worth of 203.5 billions, like bonds, for instance? It is interesting because it may help gauge the impact of these intervention. For instance, a 200+ billions (of what? EUR? bonds?) ECB intervention amounts for 80-100 pips up for EUR/USD.

I know it's very simplistic, but at least it's something that may be calculated somehow.
Yes the money was used to purchase sovereign bonds. That means that there is now an extra 200 billion euro in circulation. (effectively QE)
The ECB tries to sterilize those bond purchases by reabsorbing the liquidity. They do this by selling term deposits to financial institutions through a tender and they sell them to the bidders who accept the lowest return... kind of like a bond auction would.
The problem here is that their net balance keeps growing because nobody wants to buy these term deposit certificates.
Those who say it cannot be done should not interrupt those who are doing it
  • #12,448
  • Nov 29, 2011 5:34am Nov 29, 2011 5:34am
Quoting PipTrapper
Buma. Let me use this analogy.

Trading bonds in the secondary market is like trading currencies in the spot market.

Right now the Euro is cheap at 1.3395. So let's say you buy it coz "hey that's dirt cheap". Now the Euro dips to 1.28. So it wasn't so cheap at 1.3395, was it?

In the secondary bond market, the yield is not actually the interest paid by the borrower. It is actually the effective yield because it was sold at a discount.

Example... A bond with face value of €1 Billion was auctioned off at say 2%
The holder wants to sell it...
oh.... okay thanks pt
Have I got something on my face, SOLDIER?
  • #12,449
  • Nov 29, 2011 5:38am Nov 29, 2011 5:38am
Quoting rekon67
no wonder..my sell order activated after one week ..:S
..and TP Hit 40 pips in
  • #12,450
  • Nov 29, 2011 5:41am Nov 29, 2011 5:41am
I'm still being patient and sitting on my hands and ignoring the long trades. Still biased short euro for now. It's tough on the old noodle sitting on your hands and watching long pips go without you. I've already unplugged the mouse for a period this morning to avoid the temptation
  • #12,451
  • Nov 29, 2011 5:45am Nov 29, 2011 5:45am
Quoting rekon67
..and TP Hit 40 pips in

great job


glad people making profits
Have I got something on my face, SOLDIER?
  • #12,452
  • Nov 29, 2011 5:45am Nov 29, 2011 5:45am
Quoting lovepips
+31pips :-)
GOOD job. Nicely done.

i will be watchful of potential bounce from the trendline(RED ones).

http://www.forexfactory.com/attachme...2&d=1322563398
  • #12,453
  • Nov 29, 2011 5:48am Nov 29, 2011 5:48am
Quoting PipTrapper
Yes the money was used to purchase sovereign bonds. That means that there is now an extra 200 billion euro in circulation. (effectively QE)
The ECB tries to sterilize those bond purchases by reabsorbing the liquidity. They do this by selling term deposits to financial institutions through a tender and they sell them to the bidders who accept the lowest return... kind of like a bond auction would.
The problem here is that their net balance keeps growing because nobody wants to buy these term deposit certificates.
Thanks, that's very helpful.

So, the ECB is trying to pass along the "hot potato" and nobody really wants it, which makes ECB accumulate a lot of unsellable assets. At some point, those assets, which may no longer be converted into financial instruments, must be killed somehow. ECB kills them, but that will leave a lot of cash without any corresponding value on the market, because the assets bought does not exist anymore. And that will lead to inflationary pressure. Is that right?
  • #12,454
  • Nov 29, 2011 5:49am Nov 29, 2011 5:49am
@dddd

untested old support might crack a bounce here or stop hunt but i doubt it.

i think htas good place to load shorts if not now
Have I got something on my face, SOLDIER?
  • #12,455
  • Nov 29, 2011 5:50am Nov 29, 2011 5:50am
Quoting dddd
i will be watchful of potential bounce from the trendline(RED ones).

http://www.forexfactory.com/attachme...2&d=1322563398
Agreed, this could be the pullback to retest the break before heading higher.
The US session will tell the story.
If price moves back below the trend line and closes inside the wedge, then it can be confirmed as a fakey.
Those who say it cannot be done should not interrupt those who are doing it
  • #12,456
  • Nov 29, 2011 5:54am Nov 29, 2011 5:54am
Quoting michaelnew
Thanks, that's very helpful.

So, the ECB is trying to pass along the "hot potato" and nobody really wants it, which makes ECB accumulate a lot of unsellable assets. At some point, those assets, which may no longer be converted into financial instruments, must be killed somehow. ECB kills them, but that will leave a lot of cash without any corresponding value on the market, because the assets bought does not exist anymore. And that will lead to inflationary pressure. Is that right?
Correct
Those who say it cannot be done should not interrupt those who are doing it
  • #12,457
  • Nov 29, 2011 5:56am Nov 29, 2011 5:56am
Quoting PipTrapper
Correct
Thanks, you really do a great job here. I have no financial background whatsoever, I'm educating myself in this new thing and your insights are very helpful.
  • #12,458
  • Nov 29, 2011 6:05am Nov 29, 2011 6:05am
Quoting michaelnew
Thanks, that's very helpful.

So, the ECB is trying to pass along the "hot potato" and nobody really wants it, which makes ECB accumulate a lot of unsellable assets. At some point, those assets, which may no longer be converted into financial instruments, must be killed somehow. ECB kills them, but that will leave a lot of cash without any corresponding value on the market, because the assets bought does not exist anymore. And that will lead to inflationary pressure. Is that right?

hey, michael, i have one for you if you want: buy one, get one free. If you call 1-800-bernanke in the next 15 minutes, we will throw in a set of free kitchen knives. That is 1-800-bernanke.

http://rookery.s3.amazonaws.com/1825...0_625x1000.jpg


or you can take the next one on 50% discount. These are flying off the shelves, people.

http://nostradamus2012.com/Images/Do...ey_for_AIG.jpg
  • #12,459
  • Nov 29, 2011 6:07am Nov 29, 2011 6:07am
Wow decided to short Eur/jpy as soon as I did price fell 10 pips
Didn't realise I had become such a player in the market haha.
I'm seeing a lot of euro weakness across the board could be time to go shorting for some 50 pips or so.
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  • #12,460
  • Nov 29, 2011 6:08am Nov 29, 2011 6:08am
Quoting bumapatria
great job


glad people making profits
I would like to dedicate this pips to EURAnalysis Thread That target SELL @ 1.3430 was my 2nd Sure Hit ... but the idea and encouragement from this thread only .... specially PT
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