You know I’d have to say that I’m pretty proud of myself.
A full ten days here in January and I’ve placed a couple of little “feeler traders” here and there, but for the most part haven’t made a single “move” of any real size / conviction. The investment environment has been volatile yet “directionless” as even today ( with the “even worse than expected data” out of the U.S – surprise , surprise there Kong ) we still find ourselves “hovering” around the same levels, with currencies taking people for big rides in both directions, and plenty of questions still hanging in the air.
I think you know where I stand.
The idea of “recovery” in the United States is ridiculous, the stock market is a complete and total fabrication, the idea of “tapering” sounds more ridiculous by the day, and I expect to see global growth “slowing” moving forward.
It’s “the timing” that will be key in order to keep pulling profits.
We’ve still not been given a clear signal as to “what’s gonna happen” when we see risk come off, or even if the Fed will “allow” risk appetite to wane as…….you wonder…at what level would the Fed immediately step back in to prop up markets? ( Gees….I’m already looking “that far ahead”.)
With continued concern as to “which way will USD go”? I remain focused on the “known/obvious” correlation between Japan’s Nikkei and the Yen ( trading inversely as expected ) as opposed to getting caught up in the confusion surrounding USD, and the next turn in markets.
I don’t want to get long USD – but I will if I have to.
I’ve over road signals produced by the Kongdicator these past few days as yes….signal fired “long JPY” on several other pairs other than just AUD/JPY, but I’ve approached this with caution, made a couple tweaks and have now “extended” the entry time “x factor” further away from the time signal is initally issued. So far that has kept me out of markets longer, but also out of “chop” a full 2 or 3 days longer so……an improvement in my eyes.
Dumb question here, but I never understand the terminology around FX. If you are long JPY against AUD (which is 93.44) do you expect it to go towards 95 or 90?
If I am long JPY vs AUD – the currency pair looks / reads like this : AUD/JPY
If I am long JPY then I expect this pair to move LOWER toward 90.
I understand that it takes some time to just “rattle off” the terminology so best advice….just keep looking at them, keep repeating etc – you’ll have it down in no time!
OK thanks. So if you are long the first part of a currency pair you expect it to go up, if you are long the second part you expect the second part to go down. So way to look at it is if you are long the second part of a pair you are short the first part, therefore expect the first part to go down. That makes sense in my head….. thanks.
I don’t have a specific link Danny….but please – google “currency pairs explained” or something like that and you will find a number of websites that break it down VERY SPECIFICALLY for you.
It takes a bit of practice yes…..just keep going over it, and it will become second nature.
Markets seem jolly happy to carry on with their merry dance as we’re led to believe we’re “recovering”. My apologies for the sarcasm.
A question for you Kong if I may. In your opinion, and from experience, what will cause a proper risk off scenario. The markets seem a bit blind (and deaf) at the moment. Just wondering what would/could cause them to reverse? Any thoughts would be appreciated.
Q.
These days you’ve got it – It’s hard to imagine “what” could be the catalyst.
But…..we can’t ignore the fact that this entire “investment cycle” is getting very long in the tooth so…..what you’ll see unfold “soon enough” will be “any number of news stories / angles” to justify / explain what the reason is – when essentially its really just the normal ebb n flow of investment dollars coming into and “out of” markets as they have done for a very long time.
I can imagine “trouble in EU” or “Japanese bond yields spike” or “Tensions mount in Middle East” “Earnings in U.S Disapoint” etc….
Any one of these will certainly do for the media spin, when in reality – Wallstreet algo’s and machines will have simply switched from “buy program” to “sell program”.
Well look at that…i guess you got your answer as to when the fed step in to boost the markets.. answer is whenever the mkts turn red..
Exactly so…….one needs to be careful about “getting too excited” come correction time.
It will be a battle no question.
Hey Kong, take another look at the USDCAD pair. The price just touched one of the falling trend-lines that can be drawn from the 2002 & 2008 tops, along with the rising channel since Sept-2012. Not a bad place to short from my perspective, especially because of how overbought this pair is shorter term. Moreover, the huge spec long position makes for a great contrarian trade here. Also, lets be honest, the market isn’t falling apart yet (risk-off), so this type of loonie move is unusual to say the least, so a sizable retracement is probably extremely likely here.
It’s a good a shot / short as you’ll find but I’m still waiting til I see the trend turning on smaller frames.
Thus far…..not even a 5 minutes chart has turned a corner so…….no need to step in there now.
Ya after today’s action I’ve got usdcad on my watch list. Not pulling the trigger yet. There are a few usd short crosses that tightened up a bit and the fundamentals are still there
Everything fired off positive long Aussie/DXY …. daily tech still working away … should be good for another couple days… a take profits…..Then will wait for the re-set & see how the smaller TF fire off for possible re-entry…. So for now still long the pair….
For those log PM’s I have a daily set-up running in silver for 18 days now…. this fire should deliver some nice price moves…. Gold testing 1250 – should be good for several weeks ….. waiting on that Silver squeeze to finally fire off!!
Cheers Schmed,
Hey Kong do you see the weakness in the Canadian dollar continuing?
Thanks
Man ……short term you’d have to consider “risk off” comin so…..commodity currencies tend to take a hit.
You know my longer term views with respect to Canada’s sound banking system and natural resources.
Weakness in the U.S Economy moving forward ( in my view ) could just as easily have China fill the void as far as exports / purchase of Canadian good goes….and as / when the U.S Dollar implodes – CAD will remain stronger.
Lots of potential land mines with respect to the USD crosses as traditional views clash with changing tide. Makes it difficult to trade with conviction. I think I’ll generally stay with the yen commodity crosses. Nice long runs…risk sensitivity etc. Thoughts?
You bet……USD crossroads here big time…as am “inclined” to get long but “against my will!! ” he he he….
I’m gonna call it like I see it, across several pairs here likely Monday night / Tues eve as “technicals” favor higher USD.
JPY pairs offer a far more “obvious” and straight forward trade NO DOUBT!