Forex Markets Frozen – Risk Comes Off

If anyone’s had question as to “just what extent” the Central Banks have got their hands wrapped around these markets – you’ve gotta love this.

A -34 point loss on The SP 500 as U.S Equities erases 2 full months trading in a matter of hours, while the U.S Dollar ( and the entire currency market for what it’s worth ) remains unchanged.

Honestly, on a day like today ( perhaps a year ago ) I would have been dancing around the patio naked, with a sombrero and the Ipad, busting a gut at the ridiculous amount of profits made with my “short risk” positions – but today?

I can’t freakin well believe this. The entire Foreign Exchange Market is on lock down.

The U.S Dollar has moved all of 15 pips vs JPY and for the most part, not a single currency has made a move “any larger” than one might expect during a typical “hour” of normal trading. It’s like nothing has even happened!

Frankly, I’ve never ( in my entire career trading ) seen anything like it, and find this to be extremely concerning.

If a “day like today” can’t get this thing off it’s ass – WTF???

As these things don’t turn on a dime – I understand, but in this case we’ve got a real anomaly here.

This MUST be setting up for something far larger.

4 Responses

  1. Leonardo July 31, 2014 / 2:24 pm

    you may be right but EUR and GBP (the principal currency in the DXY) have been coming off for a few months already, perhaps foretelling the coming market correction. It doesn’t surprise me if today they’re taking the back seat and catching their breath. After tomorrow’s NFP and the next leg down of the markets, I think we may see a synchronised move. But right now, I know many are dying to pull the trigger on the markets and buy. It’s when that fails that we will see the proverbial faeces hitting the fan!!

    • Forex Kong July 31, 2014 / 2:32 pm

      I’m looking to get long both pairs and would have assumed “today to be the day”.

  2. David July 31, 2014 / 4:53 pm

    I find the timing of this sell-off rather amusing Kong, especially b/c I believe it was Yesterday that some of your critics were trashing you’re S&P Puts. Boy, the currencies might not have done much today, but those S&P Puts were Gold today!!!

    • Forex Kong July 31, 2014 / 5:20 pm

      Yes – I’m so used to it now. It doesn’t “really” bother me.

      I just wish I could get across the larger point being – these things don’t turn on a dime these days, and anyone looking to generate “large profits” has to develop a larger time frame / frame work to work within.

      In an environment such as this…small time traders with ideal of making “quick bucks” catching turns will continue to get hammered as their tiny contributions ( a couple grand here or there ) are really just “the daily take” for the big brokers / banks.

      If an individual can’t look forward a couple days / weeks and “build a position” around their longer term views – they’ll get hammered time and time again.

      All good with the puts yes. Thanks David.

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