No brainer fundamental trades

RBA rate cuts have been good to get in on. 0.82's have been good levels to get in on earlier in the year. I think if rates are cut tonight, we'll see 0.75 again very soon. As long as USD news remains positive of course...

Well, I thought the WTI dip <$45 into late winter, with obvious and persistent speculative contango/storage action in the news and evident in the data, has been a no brainer set-up for a rebound back to $60 or higher into peak demand in Summer. I traded accordingly, via USO options, and that is playing out now.

I guess I might set the bar pretty high for "no-brainer", as I'm not sure if I have any purely no-brainer trades on tap. But I will throw out some ideas:

- I think we are rolling into a setup for US indices to sell off at least 10% sometime this Summer, IF we get good econ data in the US and some continuing signs of a turnaround in the Eurozone. (It's the old "good US news brings Fed rate hike action sooner, sinks US stocks" meme.) I keep setting up to catch that move, with defined-risk options trades.....not rich yet....

- I thought short UST's, especially the long bond, has been obvious once interest rates on Eurozone sovereign debt started to come up. That has indeed come to pass, but I just didn't get in that trade.

here's another which is playing out right now. RBNZ looking to cut rates, at both June and July meetings. Sell NZD.

please keep this thread alive... it is easy to miss the wood for the trees, some of us still manage to miss the bigger picture, and therefore miss no brainers while struggling with junk. thanks for everyones posts.

I used to suffer with that until I just simplified everything.

Use a top down approach on the charts, mine is normally Weekly > Daily > H4. Then plan for the week ahead based on the risk events that are due. Filter out the unimportant ones and focus on the important. Such as CPI, GDP, and most important, Central Bank stuff.

Then simply trade in line with these central banks.

RBNZ looking to cut rates; NZD will fall.
RBA still dovish with more room to cut; AUD will fall.
Fed still talking about rate hikes even after the bad data; USD will rise.

It really is this simple.

....plus No brainer situations don't crop up that often.

So watch for talk about Iran sanctions lifting as another cue to sell oil.

in retrospect, with the benfit of hindsight, shorting the ruble when russia moved into ukraine / crimea, might have been a good idea.

2014 30 July: The EU and US announce new sanctions against Russia.

I also like the daily highs and lows approach, especially when it comes to exiting a trade, but when it comes to timing the entry with FA I think the close of the day might be more relevant. (line/mountain charts can do the job)

Sat at around mid 76's now, plenty of room to get in and keep adding positions. I still agree it has plenty of room to move lower.

I'm embarrassed to admit I spotted over half of these trades mentioned in time to act on them but had set some hard rules earlier about not making trades without a solid plan. So the mistake was: I didn't have a written plan of how to manage these types of trades. And another part of not having the plan was that some of these obvious trades that take long time may need preparation to minimize the carry/swap/interest etc costs, or atleast calculate how much they would be as these trades often take place over months to years.

Another approach would be to forget about holding the trades, just using the big picture to bias the short term trades. With the long term held trades it may be preferable to use options to minimize margin use but those have their own challenges to know about so that's not so "no brainer" either.

One (perhaps naive as I haven't modeled it) idea I've thought about is using some sort of partially hedged futures position to maybe create a smaller position where the larger side (negative carry) of it would be the future and the spot with positive carry would be the hedge. The reason to do it like this instead of with options would be such that you could then use your usual short term intraday strategy to get into the position and then turn that day trade into a "winning lottery ticket". Then there's the issue of futures rollover if using the front month etc and keeping the hedge ratio ... so again not a "no brainer" how to manage it. One persons issue is anothers opportunity. I'm not sure who said that.

Good stuff.

Back in 2008 during the economic crisis there was major movement in currency. I wonder how the Ruble has changed in the last year vs the US dollar...

I am going to be looking to short AUD, probably AUDUSD, though I'm not sure because I have a lingering doubt that the US rate hike will happen.

Nevertheless there are a couple of reasons why I intend to short AUD:
-interest rate drop as previously mentioned
-China slowdown which will hurt AUD

Another candidate to short might be Brazil but have not looking into them much.

Edit - seems like the horse has bolted on Brazil

let me contribute.. http://www.forexfactory.com/news.php?do=news&id=542063

Looks like long eurchf is a good trade..

greek exit maybe?

http://www.express.co.uk/finance/cit...ry-in-the-Euro

we can all trade usd dra soon!

price of the euro doesn't seem to be down at the prospect of this, probably already priced in to some extent but could be fun later.

no matter what u think and do, the market makers will get your money and then will do the move without you or at least without 99% of you...so chill and trade after the move if u want to make lots of money in this game

i got a broker email today warning of high volatility / gap risk on the euro opening after the weekend.

meh, not convinced, something of a gap maybe but they should of course being covering their own bottoms.

i agree, but then i also suspect a big weekend gap would be a good way of market makers getting the money without the 99% of us, and covering it with a huge spread on open. idk.

That's certainly true, interbank MM are a bit different than normal market makers, they don't have controls over the market in the same way as they would over a small stock.

If there are bids from anyone they have to quote them.

Still though, could happen, I would be surprised though. I think this Greek thing has went on for too long people know what to expect now.

Everyone is thinking price moves lower, but the maximum pain would be for the Euro to go higher - maximum pain for the most participants is often how the market seems to move lol