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Long-term wealth planning

  • #1
  • First Post: Apr 21, 2012 5:27pm Apr 21, 2012 5:27pm
hello everyone,

if you look at the monthly chart USD/JPY you can see that the highs in that pair is in economic boom times and when share markets are going down the drain, this pair will go down as well. Investors will buy a "safe" currency like the yen in these uncertain times.

May 2007 was about the top of the economic boom and from then on it was downhill until October 2011.
Suppose you sell during this period when the trend down reverses 50% from the last swing low, you would have sold in August 2008 at 110.00, February 2009 at 98.00 (although high of 101 in April), December 2009 at 93.00 (went higher in May 2010 to 95.00), April 2011 at 85.00.

Suppose you have a lazy 100k laying around; leverage 500:1 = maximum investment is 50 million;

In August 2008 at the first 50% retrace at 110.00; I sell 25 lots @ 110.00

In February 2009 2nd 50% retrace at 98.00: capital has grown to about 400k; now I sell 75 lots @ 98.00

In December 2009 3rd 50% retrace at 93.00: capital has grown to about
960k; now I sell 140 lots @ 93.00

In April 2011 4th 50% retrace at 85.00: capital has grown to about 3.300k; now I sell 580 lots @ 85.00

Price went as low as 76.00 and I would close out the position if a monthly bar closes above 85.00.

heaps of profit with 4 trades in over 3 years.

October 2011 - now: US start recovery slowly.........time to get in soon for the run back up???
  • #2
  • Apr 23, 2012 5:21pm Apr 23, 2012 5:21pm
u should write a book and be on an infomercial
  • #3
  • Apr 23, 2012 5:38pm Apr 23, 2012 5:38pm
Quoting yonnie
hello everyone,

if you look at the monthly chart USD/JPY you can see that the highs in that pair is in economic boom times and when share markets are going down the drain, this pair will go down as well. Investors will buy a "safe" currency like the yen in these uncertain times.

May 2007 was about the top of the economic boom and from then on it was downhill until October 2011.
Suppose you sell during this period when the trend down reverses 50% from the last swing low, you would have sold in August 2008 at 110.00, February 2009 at 98.00...

hindsight is 20/20 in trading
  • #4
  • Apr 23, 2012 7:31pm Apr 23, 2012 7:31pm
Quoting yonnie
y.........time to get in soon for the run back up???
Yup.... with that great hindsight I should be asking you what to do ?


not that I really will but you get it ,
right?


?
When the Joker is in the deck.. fear not and play it well
  • #5
  • Apr 23, 2012 10:20pm Apr 23, 2012 10:20pm
nobody knows exactly how it will happen from here.

but look at the overall picture: my chart goes back to 1989, but the price has never been this low in all that time.
once the hiccup in Europe has been papered over, watch for this pair to take off as well as the stock markets.

where will I get in:
with the turmoil in Europe, price might go back to test the former resistance at 78.00 and turn that level in support.
I`ll be watching the price action at that level very closely.

if it wont get there, I`ll be watching the break of the resistance at 85.00 and probably get in at a retest of this level later.

I`m not saying this is easy, but nothing is easy in forex.
But one thing I`m sure of, although I dont know when exactly: it will go up!
  • #6
  • Apr 25, 2012 10:19am Apr 25, 2012 10:19am
Quoting yonnie
nobody knows exactly how it will happen from here.

but look at the overall picture: my chart goes back to 1989, but the price has never been this low in all that time.
once the hiccup in Europe has been papered over, watch for this pair to take off as well as the stock markets.

where will I get in:
with the turmoil in Europe, price might go back to test the former resistance at 78.00 and turn that level in support.
I`ll be watching the price action at that level very closely.

if it wont get there, I`ll be watching the break of the resistance...
hiccup in europe? more like diarrhea. the probable scenerios in europe aren't even priced in yet, which is a bailout of spain++
  • #7
  • Apr 25, 2012 11:14am Apr 25, 2012 11:14am
you might be right and Spain hasn`t been factored in yet.

in that case I still have a chance to get in @ 78.00

but look at it like this: most people are pouring over the charts everyday and trying to make a few bucks with a lot of work.

would this way of trading not be a lot easier and more profitable?
take 100k to at least 3.3mil
we`ll know in 4 years time!
  • #8
  • Apr 25, 2012 11:34am Apr 25, 2012 11:34am
Give us some live calls, then we can talk.

There's an old saying, "Show me the money."

Open up a forum like this one and the dreamers come flying through.

Whatever happened to the four letter word called w-o-r-k.

Why stop with suck a lot amount? If you entered in Aug '98 at the peak at 147.71, and you took your "lazy 100K, it would now be $16 million. That's according to your math.

BTW, your theory got blow out of the water. The economies were robust through much of 2000,s, but the pair was still dropping. Or, at least the last time I checked the 80's is less than 147.


Quoting yonnie
you might be right and Spain hasn`t been factored in yet.

in that case I still have a chance to get in @ 78.00

but look at it like this: most people are pouring over the charts everyday and trying to make a few bucks with a lot of work.

would this way of trading not be a lot easier and more profitable?
take 100k to at least 3.3mil
we`ll know in 4 years time!
  • #9
  • Apr 25, 2012 2:35pm Apr 25, 2012 2:35pm
Quoting 4xpipcounter
BTW, your theory got blow out of the water. The economies were robust through much of 2000,s, but the pair was still dropping. Or, at least the last time I checked the 80's is less than 147.
dont know where you`ve been in the last decade: markets always go in cycles - boom/bust - boom/bust

2001 stock markets reach highs - USD/JPY reaches high
2004 USD/JPY reaches low and starts rising again
2007 stock markets reach highs - USD/JPY reaches high
2012 USD/JPY reaches low and starts rising again

robust through much of 2000`s: you must be joking; after 2007 the stock markets had the largest drop since 1929 and we still haven`t ironed out all the economic problems.
so yeah, that USD/JPY is in the 80`s is exactly my point.

the first green shoots of recovery are visible in the US and that is being translated in a small rise of the price.
my belief is that the US economy will - slowly - improve and you will see capital going back from the yen to the US dollar.

cycle again: boom/bust - boom/bust

so I`ll buy at 78.00 or 85.00
  • #10
  • Apr 26, 2012 10:10am Apr 26, 2012 10:10am
Yonnie, you're missing something in your equation. Times are worse now then they were when the market hit the bottom. Do you really want to believe the economy is good even though the DJIA is trading in the 13,000's. Here in the USA, it makes me sick how many people are on welfare, governmental jobs are growing, private sector is dropping, business owners are afraid to hire new people.
You are going to great lengths to show you really don't know what you are talking about.
Also, if there is such a correlation between the USD/JPY and the DJIA, then why in Arpril '09 was the DJIA at 7400, now is at 13,000, but the USD/JPY dropped from the 100's to its current level in the same space of time.

Unlike your dreams, you're talking to someone who knows the markets, so i'm aware of the cyclical nature of the markets.
Now, you want to know where I've been at in the 2000's. I said throughout most of the 200's was the economy robust. Even if it tanked in 2007, maybe you're not aware of it, but 2000--2007 covers most of the 2000's.

Okay, dreamer. Continue on!


Quoting yonnie
dont know where you`ve been in the last decade: markets always go in cycles - boom/bust - boom/bust

2001 stock markets reach highs - USD/JPY reaches high
2004 USD/JPY reaches low and starts rising again
2007 stock markets reach highs - USD/JPY reaches high
2012 USD/JPY reaches low and starts rising again

robust through much of 2000`s: you must be joking; after 2007 the stock markets had the largest drop since 1929 and we still haven`t ironed out all the economic problems.
so yeah, that USD/JPY is in the 80`s is exactly my point.

the...
  • #11
  • Last Post: Edited 10:29pm Apr 26, 2012 8:33pm | Edited 10:29pm
Alright, I`ll continue on.........well you can see that the highs in 2001 and 2007 of the DJIA and USD/JPY are quite similar.

when the markets went down, you had this flight of capital from more risky investments to the "safe heavens" of the yen and the US dollar.
more so the yen ofcourse and even after the DJIA was trending up in 2009, the flight to the safer currencies was still going on for years; delevering remember?
that`s why it took the USD/JPY longer to find the bottom.

I know the situation in the US is not rosy, but it is very slowly getting better with the unemployment rate dropping.
some other countries are even in a worse situation.

I dont think a lot of people expect the DJIA to go back to the 2009 low,
so other people must be more optimistic as well that the economy will SLOWLY improve from here.

It`s just my opinion that over the next 1-2 years the problems will be ironed out and up we go.

boom - bust - boom - bust - boom - bust..................................................
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