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EUR/USD... Why such a huge move?

  • #41
  • Dec 4, 2015 5:48am Dec 4, 2015 5:48am
Quoting skfx
{quote} Of course they don't. But its what happened! A CBs primary mandate is price stability. Personally, i think the CBs hate institutions running ahead. We now have a EUR higher and it's not what the ECB want right now. I noticed while watching the ECB presser that Draghi brought up something that could be implemented down the line. He mentioned that a period preceding the announcement day, no ECB members would be commenting on policy etc. Lets just say that most CBers suck at communication. And the market likes to get a little excited at times...
Yes I agree with that and I believe some of us felt that way that kept us out of harms way. There are many instances where such hype caused the price to run ahead, this one being another in a list of many others. The current question from NFP to FOMC is whether this pullback is another overdone reaction when many perceive the rate hike is a done deal. This latest hype, the last for the yr, starts in a few hrs time.
  • #42
  • Dec 4, 2015 5:54am Dec 4, 2015 5:54am
As I read through these posts it seems most everyone tries to believe they know something about the world's financial problems using the fundamentals. It really is a far greater puzzle than anyone on forums can solve. Predicting is a lot of fun but can be dangerous if not quick with the trigger finger. I saw no posts dealing with technical analysis and I wonder perhaps if it was time for a turn in prices given some old fashioned Elliott Wave analysis coupled with Fibonacci and maybe even the Delta Phenomenon dealing with repetitive cycles of varying degree.
Here is a snap of what I refer to in this url
http://content.screencast.com/users/...12-04_0639.png
Good trading everyone

Slick60
  • #43
  • Dec 4, 2015 6:01am Dec 4, 2015 6:01am
Quoting skyway
{quote} Yes I agree with that and I believe some of us felt that way that kept us out of harms way. The are many instances where such hype caused the price to run ahead, this one being another in a list of many others. The current question from NFP to FOMC is whether this pullback is another overdone reaction when many perceive the rate hike is a done deal ?
Yes, absolutely!

EURUSD for me right now could go either way. We could get further liquidation of shorts and another squeeze.
Maybe NFP flops?
Maybe FED day comes and they hike but it's a 'dovish' hike?
We have two CBs here going nut for nut and institutions calling them forward LOL

I much prefer trading pairs/crosses that are just doing what they are supposed to, without the big parties going on.
Just rolling along in the background.
It's always strong against weak, but you need a clean environment.

This EURUSD trade is 'dirty' for me.I chose not to trade it, that's just me.

Good trading to you!

rgds
SK
  • #44
  • Edited 6:23am Dec 4, 2015 6:12am | Edited 6:23am
Quoting slick 60
As I read through these posts it seems most everyone tries to believe they know something about the world's financial problems using the fundamentals. It really is a far greater puzzle than anyone on forums can solve. Predicting is a lot of fun but can be dangerous if not quick with the trigger finger. I saw no posts dealing with technical analysis and I wonder perhaps if it was time for a turn in prices given some old fashioned Elliott Wave analysis coupled with Fibonacci and maybe even the Delta Phenomenon dealing with repetitive cycles of varying...
Slick, that is a fair enough statement!

I am a big believer in the macro/fundamental and i didn't trade EUR at all.
Sometimes you have to weigh it all up, and if there isn't a good enough 'edge' there, then you slide on it.

If you look at the CBs respectively, the FED is about to go(albeit, in a dovish manner) and the ECB are still on the printing press.
There is some sort of divergence there but we have huge risk events and participants have been pricing stuff in and this is when it gets deadly.
The experienced will have done what numbnuts did or choose something else to play where they were not exposing themselves to 'flow' risk.
I was trading AUD/NZD and therefore had lower exposure to these 'flow' risks.

The ECB brought a bomb to the party yesterday, but i chose not to attend that party.
I was instead enjoying a friendly BBQ hosted by the RBA and RBNZ

Each to their own though.
  • #45
  • Edited 6:38am Dec 4, 2015 6:23am | Edited 6:38am
Quoting magnumfreak
Sometimes not trading is a win.
This about sums it up, everything else aside!
If it doesn't offer you 'edge' and the 'risk' is to high, then not trading is most definitely a win!

When i was studying at aviation college in Sydney(Commercial pilot theory) many years ago, we had a saying:
"Better to be on the ground wishing you were in the air, than in the air wishing you were on the ground".

rgds
SK
  • #46
  • Dec 4, 2015 7:04am Dec 4, 2015 7:04am
they had to fill Golman Sach's short SL
Do what's right for you
  • #47
  • Dec 4, 2015 7:40am Dec 4, 2015 7:40am
Quoting paka
[...]
Another one on the topic: https://www.vantagefx.com/news-centr...ever-it-takes/
  • #48
  • Dec 4, 2015 7:52am Dec 4, 2015 7:52am
Tooo many retail traders was in profit. They had to clear the playground before payroll
  • #49
  • Edited 8:27am Dec 4, 2015 8:10am | Edited 8:27am
Imagine you have bunch of sellers of stuff on ebay. There's a lot of items selling for "fair" prices*. Then someone buys all those except some ridiculously expensively priced one. This tends to happen at times when market makers gets scared away by news releases**. When one opened the price list it shows last sales at fair price and someone still trying to sell at unfair price. The "art" is really about trying to determine a fair value. I use combination of technicals and sentiment (stuff starts getting bullish *after* a big move up. There's a reason why that tends to crash the price. I don't think it's always that the public is buying the top as much as it is that because the prices have moved to extremes, people are recognizing the price is perhaps not fair and stop trading - once the market makers notice the drop in volume they will move price where the volume is)

But now throw in the HFT to this mix. They are fast traders that may not actually have any stock but are prepared to sell and buy any amount. They expect the "any amount" will become available to them later:

HFT MM offers to buy/sell a little below the "ridiculous price".. so you see the price is "ridiculous". Asuming they sell for example: Since the HFT is selling what they don't even own, when you buy from them, the market immediately starts to go lower.. it will go lower and lower until someone will sell. Then if you are patient enough, maybe you get to sell at the ridiculous price eventually... better plan though is to recognize that if it starts going lower after you buy, try to recognize the bottom and average in limited manner (hedging & options help here) to lower cost basis. For this to work you have to recognize how much margin you have remaining if the price moves below previous lows in order to shake out some sellers so the market makers who sold stuff they didn't even have are able to deliver that to the dude who bought from them when they made markets near the ridiculously high price.

Note if you trade small, you don't really need to buy "ridiculous price". This only applies if you buy large and want to hold for big moves. Large buyer may want to buy at higher prices when everyone else is selling there. They are able to wait for even more ridiculous prices.

*"fair" might be vs some historical high. like eur 1.18 vs 1.05.. 1.05 seems like fair right? or perhaps a not very long lasting bargain.

**since many news are scheduled for same time of day, they are doing that on regular schedule, so sometimes market might move without any news if the only offers on the market were far away - remember - retail prices are based on midpoint and when spreads are widened that midpoint could end up anywhere below the one "ridiculous" offer - though perhaps the ridiculous offer was just someone who forgot to average after buying near last ridiculously high price.
  • #50
  • Dec 4, 2015 9:54am Dec 4, 2015 9:54am
Quoting Borg
{quote} Hello paka: That looks like a good answer to your thread question. Do you have a link to that source ? Thanks Borg
Unfortunately, I cannot provide you the link. The table arrived from one of the strangers on one of the IRC channels. Best, K.
  • #51
  • Dec 4, 2015 9:57am Dec 4, 2015 9:57am
Quoting smeden
Tooo many retail traders was in profit. They had to clear the playground before payroll
They don't care about retail traders.
  • #52
  • Dec 4, 2015 1:29pm Dec 4, 2015 1:29pm
Quoting magnumfreak
EURUSD has been very constipated lately. Someone gave it an enema and off she went. I gave up trying to understand why a long time ago. Now I just trade the way I trade and ignore the rest. About the only time I won't take a trade is 30 min before and at least 30 min after a rate announcement. It's about the only one that I can honestly say when I look back it is easy to tell when they happened. Everything else is pretty much just a pothole in the road, irritating when you hit it but quickly forgotten. I really feel bad for those who were short...

You have to understand that some ppl leave their positions open. Some ppl even leave them open till they expire.

Some ppl probably have stuff to do or only want to spend say a certain amount of time say 30mins for example per day looking at the charts so what they do is they leave their positions open etc and then go off to do something else. What would you suggest these ppl do? Should they totally not open any positions at all?
  • #53
  • Dec 4, 2015 1:33pm Dec 4, 2015 1:33pm
Quoting vasily
early hinted ECB moves by Draghi were alredy priced in eurusd, today market made the correction due to weak move of ECB. if ECB would have been more hawkish eurusd would break down and then pullback. but dowish actions of draghi coused the correction. more, every move even caused by ecb is actually corrections before fed decision release. that is the big day. understand that, the gap (fast eurusd down move , you can call it hidden gap) opened by draghi on oct,22 is filled today with up move due to more dowish then expected. the reason why draghi...
how did you get this information? I mean i know they broadcast the ECB online but do you actually watch him give his speech?
  • #54
  • Dec 4, 2015 1:41pm Dec 4, 2015 1:41pm
Quoting forex_fairy
{quote} how did you get this information? I mean i know they broadcast the ECB online but do you actually watch him give his speech?
Yes!
Official ECB website. Media page.
Rgds
SK
  • #55
  • Dec 4, 2015 2:49pm Dec 4, 2015 2:49pm
We will see the same reaction after the Fed hike. EURUSD will rather go up after the decision, as market expectations fully price in the hike. Markets will be watching FOMC statement that could be dovish.
  • #56
  • Dec 4, 2015 3:16pm Dec 4, 2015 3:16pm
As today was my first day watching the charts (yes I'm a newbie) I couldn't figure it out by trying to put patterns to it so I ended up checking the news and figured out why.
Here is a screenshot: http://oi65.tinypic.com/313p006.jpg

I think that since this was my first time watching the charts live I did a pretty good job figuring it out by myself so i consider today a success
  • #57
  • Dec 4, 2015 4:43pm Dec 4, 2015 4:43pm
Quoting forex_fairy
{quote} how did you get this information? I mean i know they broadcast the ECB online but do you actually watch him give his speech?
instead of spending your time here with some losers, follow speechs via twitter from different sources and get the clues. you cant find my above words anywhere while most of the market players were short on eurusd. but its important to create your own view after listening news and reading charts. this is not rocket sicence but just need some experience to create a hint about market sentiment and believe ma takes seconds. but you should be following the whole market everyday then you will get the hint auto. you dont need to study all nights.

$GS failed about direction of eu on ecb meeting. next time I will fail this is how this shit works.
http://news.forexlive.com/!/eurusd-g...o-ecb-20151202
  • #58
  • Dec 4, 2015 4:48pm Dec 4, 2015 4:48pm
tip for you: question the no reason moves. this will give you fundamental diverenge. diverenge is a fundamental tool not technical

Quoting vasily
{quote} instead of spending your time here with some losers, follow speechs via twitter from different sources and get the clues. you cant find my above words anywhere while most of the market players were short on eurusd. but its important to create your own view after listening news and reading charts. this is not rocket sicence but just need some experience to create a hint about market sentiment and believe ma takes seconds. but you should be following the whole market everyday then you will get the hint auto. you dont need to study all nights....
  • #59
  • Dec 4, 2015 4:59pm Dec 4, 2015 4:59pm
Quoting MisterWhite
{quote} They don't care about retail traders.
Too many traders was in sell profit. As its a zero sum game. You know what happend.
  • #60
  • Dec 6, 2015 6:06am Dec 6, 2015 6:06am
Is this explanation plausible?

http://kingworldnews.com/this-is-the...lobal-markets/

The Carry Trade Nightmare
But Draghi threw a wrench into this carry trade when traders became disappointed with the outcome of the meeting. The ECB did not increase monthly QE purchases as was highly anticipated. Draghi kept the level of monthly purchases at 60 billion euros. However, he did extend the program by six months and lowered the deposit rate by 10 basis points. This caused the euro to soar against most major currencies and sent carry trade speculators scrambling to sell bonds and stocks, and then sell dollars to cover their short euro position.
If you are new to FX don"t follow my trades, I 've blown many live accounts
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