forex market analysis

Potential Waterfall Action – USD and U.S Equities

Forex Kong Got something to say?

Don’t ask me why……..you already know why.

Fact of the matter is the big boys already sold all their long USD positions to “you” over the past 6 months. ( The move higher on bogus economic news – taking 6 full months to unwind and pass the bag to retail bagholders buying the hype. )

Equities? Common…….topped “months ago” and have been in “distribution phase” ever since.

Look out as this continued sideways action ( looking at the entire year of 2015 ) may have just shown its hand.

I’m long JPY against everything…..I’m short USD vs the Eur currencies…and I’m looking for waterfalls.

 

 

 

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Long JPY – Kong Nails It Again

Forex Kong 11 Comments

It’s one of the most counter intuitive trade concepts out there….and not surprisingly – also one of the most lucrative as the vast majority of retail traders continue to find themselves on the wrong side.

The Japanese Yen has been one of the largest contributing factors to the seemingly never-ending rally there in the U.S , as the Bank of Japan ( some time ago ) obeyed their master ( The U.S Fed ) as always…..printing Yen like mad and taking some heat off USD.

Yen then borrowed at 0% – and used to pump U.S Equities. It’s called the Carry Trade….and the big banks love it.

Until it’s time to unwind of course. Fast and furious, leaving the majority of retail traders in the dust…The Yen literally “takes off into the upper atmosphere” when risk ( U.S Equities ) is sold….and all those little Yen head back to Japan.

You are seeing a small example of that this morning with AUD/JPY trade now well in profit ( hey! Wasn’t that suggested a few day ago?? ) as well as nearly every single JPY pair making reasonable moves.

If you take anything away from this blog short of the odd chuckle – put this in your tool box. It will make you some serious coin.

Members! – The site is still down as these morons just can’t get it figured out ( hosting is so difficult right? GRRRRR!! ) Pick up here in the short term and we’ll be back up and running pronto.

 

 

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Open Your Mind – Aud/Jpy Is Next To Fall

Forex Kong 3 Comments

I sound like a broken record.

Simply put ( for the 10,000th time ) The Japanese Yen takes huge inflows when risk comes off…..and commodity related currencies such as The Australian Dollar sell off hard.

You’ve got the best of both ( no shit sunshine ) when trading the pair – AUD/JPY….taking advantage of large moves ( in opposite directions ) of BOTH currencies.

This is the kind of thing currency traders really look for.

Take a quick peak at AUD/JPY on a daily chart….and once again plot the beloved 200SMA.

See anything you like?

No brainer here “price wise” as this retracement in an obvious downtrend screams “sell”.

You have to keep in mind though……price and time are two different things. This is a great level to start thinking short the pair…….regardless of how long it bounces around at the 200.

Me? I’m getting under it with sell orders a full 100 pips below. If she screams higher ( doubtful ) then I’m not in the trade ( get it? ) – job well done.

When she falls…..I get picked up on momentum.

Eezy peezy.

You have to learn to let the market come to you…….stop chasing shit all over your screen.

 

 

Trend Break Established – Drop To Lower Time Frame

Forex Kong 4 Comments

Pull up $dxy ( dollar index )

Drop to a 1 hour time frame…..and plot the 200 SMA.

Let USD retrace ( move higher ) to touch the 200.

Mark this level.

Place a “limit sell order” 50 pips below said level with a stop a full 100 pips “above”.

Ride this trade for 11 days.

Ask me more.

Thank me later.

Do the exact opposite long EUR/USD.

Ask me more.

Thank me later.

Forex_Kong_Eyes_Real

 

 

 

 

Patience In Trading – Jedi Mind Tricks

Forex Kong Got something to say?

The ability to remain patient with your trading is arguably one of the most difficult skills to master when first getting started. You turn on your T.V, you hear the bullshit “hype”, you pull up your charts and you see the action , then something comes over you like a Jedi mind trick.

“Push the buy button Luke…..be apart of something…….change your life……..get rich…..buy…buy…buy”. As the Emperors spell works its magic on you.

The discipline needed to fight back, to remain “true to thyself”, to block out these evil messages and to remain patient is virtually impossible to exercise – short of many. many years out in the swamp practicing with Yoda.

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Timing helps….but ultimately it’s patience that serves you best.

How can this be learned? ( Cuz believe me I can tell you…….it’s impossible to teach ) In a word……

Observation.

The market is full of opportunities each and every day…some bigger than others, but in all..there is never a need to “rush in”.  You can still call yourself a trader. Just a trader that has learned to exercise patience.

“Errr…trading you will do then……strong is the force with you.” ( In Yoda voice of course ).

USD Shorts obviously “massive” trade as of this moment.

USD Short – Luke And I Shift To The Darkside

Forex Kong 18 Comments

Stubborn as a mule…this kind of mindset can really get you in trouble.

If it wasn’t for the reasonable understanding of the “big picture” it would be very easy to just jump on the ‘long train” and passively assume the The U.S Dollar will continue to rise.

What’s also interesting to note is that no matter how much media hype, or how many days where risk is still “seemingly in the green” – world markets are still in the process of putting in a “lower high”.

After an entire month trading sideways The SP 500 as well DOW are still unable to make new highs, and are now “juuuuuuust on the edge” of tipping back to the dark side.

I hear rumors that Luke Skywalker slips over to the dark side in the new Star Wars film.

Sign of the times maybe. The timing looks right to me.

Short Humanity – Long Interplanetary Travel

Forex Kong Got something to say?

The wait has been brutal, and the USD pairs “wide-ranging behavior” has made it very difficult to pick a specific level, and feel “good” about nailing an entry.

Patience has been pushed to the limit, as the daily volatility continues to wipe out the small guys.

I dare say it again…..but we should see the waterfall commence here very , very soon.

With continued concentration on the JPY pairs vs AUD, NZD and CAD – what can be said?

These trades continue to produce, now I dunno….several hundreds of pips ( 1000’s cumulatively ) in the green.

If you’ve still got a couple pennies in your jeans…..remain short…add short risk as we are clearly moving lower ( and in my view even lower ).

Interestingly……you can’t have a low in Oil…….without a high / turn in USD ( as oil is priced in USD )

I remain short risk…..long JPY and short USD….and as suggested some weeks ago – Feel free to take a look at the profits come mid/late October.

Bloglodytes Unite! – Intro To Economics

Forex Kong Got something to say?

Q: What did the midget say when I asked him for a dollar?

A: “Sorry bud……………………………………….I’m a little short”.

Feel free to pull the trigger anywhere in here today, as most currency pairs have done what was expected – providing for fantastic entries here “short USD” and short “risk in general”.

You’ll see a number of the other usual correlations play out ( as this is so straight forward and obvious ) with commodities moving higher as “the currency that they are priced in” slides lower, then lower…….and lower some more. And yes folks…..even gold and silver!

Again I marvel at the “hoards of financial bloglodytes” peddling this kind of information for money.

This is about as common knowledge as it gets.

Literally……”Introduction to economics 101″.

 

 

Wait For It…..Learn Something Numb Nuts

Forex Kong Got something to say?

Learn something here.

As a point of interest. Mark a couple of price levels on any given pair…….NOW.

Then…….sit out the bullshit / retail gong show volatility that will ensue this afternoon.

We will reconvene this afternoon/tomorrow morning  as you save yourself the grief of “guessing/hoping” you’ve traded the news correctly.

You won’t miss a thing….in fact you will “gain” as……..

You grow as a trader…..and let the market “tell you” which direction it’s headed all on it’s own.

“Then” you make your play.