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Take cover!

  • #1
  • First Post: Edited Feb 15, 2015 3:35pm Feb 13, 2015 9:27am | Edited Feb 15, 2015 3:35pm
Hi all,

so as am spamming all threads while trading many pairs and keep on repeating myself, I have decided to start a new thread, where I may roam with simmilar minded persons.

These are main thoughts for this thread
1) Take cover!
2) Right analysis
3) Fun

Ad1) Most of the times on trading I spent with various analysis of how to prevent market from screwing me over. On the long run think best to diversify portfolio both long and short. If diversified well, long term stays a bit safer. But you got intraday waves, coming out of news, weekly moves, monthly moves... so in essence you need to restructure your portfolio real fast sometimes. You make intraday restructure, intraweek restructure, its many.

Ad2) I would prefere posters to back up their views with valid FA or TA arguments.

Ad3) Have fun, market is rough enough on us. We should chill out from time to time.

Am hoping some likeminded persons will join me here.

T
"I know one thing, that I know nothing." Sokrates
  • #2
  • Feb 13, 2015 9:42am Feb 13, 2015 9:42am
So, the innitial simplified thoughts of mine:

Am trading the most liquid markes, just coz I want to be safe and have cheap spread. So I trade US, EU and Japan mainly. When it comes to diversification of portfolio to more pairs, I usually use USD crossess with very low leverage, as, like it or not, Dollar moves the world.

Long term:
So currently USD is experiencing pretty long bull trend. Reasons could be many, but imho is as simple as Oil was falling superhard and with global debasing race, just a little hint out of US they may hike made it a long term safe haven.
EUR in very mess, ECB QE, long term EUR very bearish.
Yen long term Kuroda and Abe san double monetary base, so bearish.

Mid term:
USD bull corrects, very possibly because of bounce in Oil + SaP breaking highs. - in essence I have covered mid term to GBP,
EUR can experience short term inflow, because as SNB+ECB combo pressed us very low, now is supercheap for foreign investors to buy it. Also QE so massive I expect it is gonna lurk them.
Yen. Mid term news suggest it may be restructure of BoJ expansion program, as not working as desired - so heavy bull if not a rumour.

Short term are in my opinion mostly charts and news, gonna be posting these .

T
"I know one thing, that I know nothing." Sokrates
  • #3
  • Feb 13, 2015 9:53am Feb 13, 2015 9:53am
So currently thanks to mentioned global debasing, not sure if this is called the "risk off" thingie (?), all stocks @ world up, commodities up, risk currencies up, and USD beats me.

So am covering into GBP. But is Friday, I prolly soon gonna stop taking cover and better take shover....and go outside. Due to long term view, I refuse to buy Yen and Eur. Perhaps is a mistake, as short term seems valid buy.

Regarding those GBPs here. There goes another rumour, Brittains following trajectory after US, so may hike second.
"I know one thing, that I know nothing." Sokrates
  • #4
  • Edited 10:08am Feb 13, 2015 10:07am | Edited 10:08am
NZD is part of my portfolio and just got cut on high break. Is one of those risk currencies appreciating. I plan to reload those one. Is just a very long term diversification and small leverage. Am trying to apply the same to AUD, but with a slightly higher position.
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"I know one thing, that I know nothing." Sokrates
  • #5
  • Feb 13, 2015 10:15am Feb 13, 2015 10:15am
This is where I try to dodge USD short term weakness into GBP. Not sure is a great idea, as we are about top and see that massive h1 rejection. Also m15 now pretty scary. However, we have also made a HH. These are intraday scalp entries, so stops very close below @ 1,53685. Should this intraday range break, think my plan intraday sucks and we are about to test 1,526, where I load more mid term trades.
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"I know one thing, that I know nothing." Sokrates
  • #6
  • Feb 13, 2015 10:23am Feb 13, 2015 10:23am
And this is my long term lover and short term nightmare, attempting to bounce off consolidation mid up to that yellow line to close week. I have small mid term positions here and pretty scared. Doesnt matter in the end if BoJ stops expanding or not, coz it is mainly sentiment what drives the market short term.

We have made both LL and HH here, seems chop is starting.
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"I know one thing, that I know nothing." Sokrates
  • #7
  • Feb 13, 2015 10:46am Feb 13, 2015 10:46am
Quoting Tom_D_Trader
This is where I try to dodge USD short term weakness into GBP. Not sure is a great idea, as we are about top and see that massive h1 rejection. Also m15 now pretty scary. However, we have also made a HH. These are intraday scalp entries, so stops very close below @ 1,53685. Should this intraday range break, think my plan intraday sucks and we are about to test 1,526, where I load more mid term trades. {image}
M15 chart now goes real hard after me. Looks like a bad dodge. However could be just test of 1,5382 daily, for bulls to get enough momentum to break highs. I hope
"I know one thing, that I know nothing." Sokrates
  • #8
  • Edited 11:40am Feb 13, 2015 11:08am | Edited 11:40am
Quoting Tom_D_Trader
Long term: So currently USD is experiencing pretty long bull trend. Reasons could be many, but imho is as simple as Oil was falling superhard and with global debasing race, just a little hint out of US they may hike made it a long term safe haven. EUR in very mess, ECB QE, long term EUR very bearish.
So loaded second small long term position on EU. Stops above 1,148 - will twink number precisely later.

This is how my exposure looks like on those nice charts broker sends me:
Most is in now intraday dodge into GBP, which pushed me in GBP/Yen chart, though I dont have many positions there. Rest is long term UJ longs.
See so while looking at this exposure: you may have an idea what a day I had yesterday :/

Looking at PA, dunno if it was great idea with that GBP dodge. But tell me short safe haven in global debasing war huh? . So far supports hold. Seem cracking though. edit: Ha! Hold on m5..... but working on it.

Check SaP! Tested highs and retracing. Also Oil printed 1st red h1 in long time. In essence, both SaP retracing from top and Oil running out of bounce steam may result in USD ranging. I may take cover

And while SaP retracing, Nikkei reaching all time highs! Go Yen short go! edit: i got myself confused here. Just this years highs. All time highs a bit higher. Also should retrace here.
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"I know one thing, that I know nothing." Sokrates
  • #9
  • Feb 13, 2015 12:05pm Feb 13, 2015 12:05pm
Quoting Tom_D_Trader
So far supports hold. Seem cracking though. edit: Ha! Hold on m5..... but working on it.
So H1 holds on UJ, GJ and GU. Nikkei seems not stopping... but they gotta pull the trigger one day.
"I know one thing, that I know nothing." Sokrates
  • #10
  • Feb 13, 2015 12:38pm Feb 13, 2015 12:38pm
SaP retraced from all time highs and currently bouncing. Think is called risk on or what. Oil also down... Nikkei follows. Range play.

nikkei the only one holding though. The others falling fast. Dunno wtf that Yen again :/

Well ok, I think it is gonna be ranging and actually dont like Fridays, so I call it a week. Am also stacking up more on Eur shorts. Cya later, T
"I know one thing, that I know nothing." Sokrates
  • #11
  • Feb 15, 2015 11:04am Feb 15, 2015 11:04am
K, so lover goes first. Due to recent developments in Japan, namely talks about Bank of Japan revising their monetary policy, as aint working (really funny how now everyone sees QE aint working..,) and also due to bounce in Oil, I am revising my mid term view percentage. As triangle got broken I have said am about 75% convinced we wont get waves D,E and continue to break. Recent development gave higher value to Scenario B. Nevertheless, as we are still above consolidation mid, I consider this hold on weekly chart. So technically Scenario A @ 60%, but fundamentally very unstable. Result may be range between scenario A and B at the start of week, which is marked by white square. Currently am holding just mid term positions, with stops below mid @ 118,15. So no intraday entries in this chart for me at start of week.
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"I know one thing, that I know nothing." Sokrates
  • #12
  • Feb 15, 2015 11:14am Feb 15, 2015 11:14am
Quoting Tom_D_Trader
and also due to bounce in Oil,
So as said for the same reason I have dodged from my Usd exposure in UJ longs, by buying GUs here. Bought after monthly dropzone with top at 1,52 hold and D1 bounced. Now got primary stops real bad just under Fridays low :/, secondary safe below 1,52. I aim for retest of last consolidation zone @ 1,565 as a short term target.

So I hold positions here in GU...and it also forced me to Dragon chart, coz I have switched my USD exposure to GBP. Dragon chart is below, we are currently attempting to correct last move currently closed above Fibo 61,8. But unfortunately is the same situation as with UJ. Though both charts hold and seem is still Yen short, case BoJ stops expanding turns thing heavy over :/.
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"I know one thing, that I know nothing." Sokrates
  • #13
  • Feb 15, 2015 11:32am Feb 15, 2015 11:32am
EU chart pretty simple in my view . I want to load mid term EU shorts here below 1,1475 and cover @ April. Already started. Think Eur is a clear sell. Yet again, king dollar rocks the world, so even here Oil bounce has heavy implications. I have already started to load and am waiting with hammer above, should squeeze push us to 1,158.

Cover @ April imho very suitable, as Eur now a) seriously undervalued b) Oil approaching 2K8 lows, so could/should brutally bounce c) market will start pricing in US hike expectations.
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"I know one thing, that I know nothing." Sokrates
  • #14
  • Feb 15, 2015 11:59am Feb 15, 2015 11:59am
Quoting Tom_D_Trader
c) market will start pricing in US hike expectations.
I want to expand here on those hike expectations as is very important issue. Would like if some of you watchers joined me .

So, imo case US hikes, starts massive portfolio restructure. Long term effect ofc will be USD buy, as taught in books. But short-mid term effect is it triggers deleveraging in markets now flooded by US expansion program. Is yet again sell on stocks and commodities and USD buy, but also as I often point out, massive outflow of investors out of US markets, which is a USD sell. Also, I expect should this scenario come, these very same investors are gonna fly their cash to Europe, as in the meanwhile I believe due to ECB QE program EU "stabilises" and is gonna be posting pretty good numbers. As a result, US hike may start reversal of trend in EU, therefore I cover @ April .

To be pricese here. Imo US hike is a clear Eur buy.
"I know one thing, that I know nothing." Sokrates
  • #15
  • Feb 15, 2015 12:31pm Feb 15, 2015 12:31pm
[quote=Tom_D_Trader;8070052]{quote} I want to expand here on those hike expectations as is very important issue. Would like if some of you watchers joined me . So, imo case US hikes, starts massive portfolio restructure. Long term effect ofc will be USD buy, as taught in books. But short-mid term effect is it triggers deleveraging in markets now flooded by US expansion program. Is yet again sell on stocks and commodities and USD buy, but also as I often point out, massive outflow of investors out of US markets, which is a USD sell. Also, I expect should this scenario come, these very same investors are gonna fly their cash to Europe, as in the meanwhile I believe due to ECB QE program EU "stabilises" and is gonna be posting pretty good numbers. As a result, US hike may start reversal of trend in EU, therefore I cover @ April . To be pricese here. Imo US hike is a clear Eur buy.[/

Even if I Will not be posting, I'm with you!
PVSRA
  • #16
  • Feb 15, 2015 1:24pm Feb 15, 2015 1:24pm
http://www.econmatters.com/2015/02/b...irst-rate.html

You can google as well as I can, there have been lots of pieces coming out looking at what will happen if/when the Fed starts raising the funds rate. Looking at what will happen based on what has happened before is a natural approach, always worth inclusion, BUT..."that was then, this is now" always applies, too. Much of the "historical analysis" looks at rate hike effects on US equity markets - effects on relative strength of currencies maybe a tougher call...

The unique "then vs now" scenario in play today includes the stark divergence in major CB policies and the (once again) threat of EMU dissolution. I could see your "strong EUR" projection playing out if things settle down in the EMU (even if it's just cans getting kicked down the road, as usual) and the ECB's QE ignites a protracted bull run on risk assets in the European markets.

Given the toppy aspect of US equity markets, it's natural to expect Fed hiking would bring about the long-awaited US stock market correction. But that depends on what "Fed hiking" means. The Fed may make a token fund rate increase in June merely because they have all but promised to do so - and then do nothing else for the rest of the year. The rate of rate hiking matters. And it's not like there has not been a glacially long buildup for US markets to price in whatever symbolic rate hike may be coming.

Well, I could blather on, but to be short, it's not as cut and dry as it may seem. I think EUR weakening was always part of a program set in motion m/l at the last Jackson Hole. If I had to guess I'd bet Europe survives another Greek drama and keeps muddling toward further unification. The Fed will start to take baby steps toward tightening this Summer. US equities will dip but not hard. The ECB's QE will rally risk asset investment in Europe. The EUR will grind up against the USD.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #17
  • Feb 15, 2015 1:53pm Feb 15, 2015 1:53pm
Quoting The Fool
Well, I could blather on, but to be short, it's not as cut and dry as it may seem. I think EUR weakening was always part of a program set in motion m/l at the last Jackson Hole. If I had to guess I'd bet Europe survives another Greek drama and keeps muddling toward further unification. The Fed will start to take baby steps toward tightening this Summer. US equities will dip but not hard. The ECB's QE will rally risk asset investment in Europe. The EUR will grind up against the USD.
I have read enough, I prefere listening to you. Or me . Very agree with the latest part. Simplify ftw. Regarding Europe, I doesnt even cross my mind they do anything else but kick the can hard. They r pros in it.

Think markets overall addict to QE, so in effect FED cant even make a big hike. All they can do is a lil hike to test market reaction. And since S&P still breaking highs, I wouldnt say much of a hike is priced in. So in such case imo it starts pretty big (no small dip like you suggest) deleveraging all over world stocks and - more importantly bonds. So it will be global risk on, and people withdraw cash of risk assets and restructure. But think such case will bring infestors to short term safe haven, Europe. See, market suffers this short termism lately, actually its not only market but also people. Combined with QE addiction is imo pretty nice mix for Eur strength. Long story short: US hikes = everything falls, but Europe slowest, and since ECB QE overshoot, may even grow. Also I plan invest in Europe real estate funds for this short term - well short term, plan to hold @ 1,5 - 2 years.
"I know one thing, that I know nothing." Sokrates
  • #18
  • Feb 15, 2015 2:06pm Feb 15, 2015 2:06pm
Quoting Tom_D_Trader
And since S&P still breaking highs, I wouldnt say much of a hike is priced in. So in such case imo it starts pretty big (no small dip like you suggest) deleveraging all over world stocks and - more importantly bonds. So it will be global risk on, and people withdraw cash of risk assets and restructure. But think such case will bring infestors to short term safe haven, Europe. See, market suffers this short termism lately, actually its not only market but also people. Combined with QE addiction is imo pretty nice mix for Eur strength. Long story...
well, I could see a bigger drop for US equities also, will be watching reaction to last FOMC meeting minutes in coming week for a little tell. US bond market already started to crap pants, witness ^TYX pop in just the last couple weeks, one of biggest 2-week rises ever. I'm wondering if US equities will begin to follow suit soon? With all these CB printing presses running lo these many years, and now ECB cranking up to keep the printing party going - all that cash has to go somewhere - I just want a little froth to slosh out of the feed trough and into my tiny cup.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #19
  • Feb 15, 2015 2:12pm Feb 15, 2015 2:12pm
Mate, I am so glad you joined me here. I actually didnt think of it, was just loading mid term EU shorts and FOMC could be trigger against me. Hmm.. also could be trigger for me, if they delay QE - which imo they should. The other case is what they want to tell to markets. Perhaps EU could be ranging till next meeting.

Either case, they a) should delay hike b) E/U in hyperbolic move down and politicians blathering bout Greece. Now though we agree they kick the can, before they do, is Eur sell. So can finish for low. EU politicians generally slow, so Eur has a space to weaken further, before they decide how to kick it.

Edit: Generally speaking because of this think Eur/Gbp short could be pretty nice trade for next week.
"I know one thing, that I know nothing." Sokrates
  • #20
  • Feb 15, 2015 2:21pm Feb 15, 2015 2:21pm
http://www.businessinsider.com/miner...-timing-2015-2

lol, count on Bullard to work the jawbone. Anywho, if you are a casual investor, high-yield corporate debt is going to start to look better if the Fed comes through, AAA corporate >5% on the horizon

http://finance.yahoo.com/bonds/compo...aWQDBHNlYwNzcg--
"If The Fool persists in his Folly he will become wise." - William Blake
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