It’s unfortunate that we’ve been so patient these days, only to now find the odd “profitable trade” finding itself slightly “back in the red” – with the huge ramp up in both The Nikkei as well SP 500 ( our risk barometers ) on absolutely no news “if not” bad news.
So is forex.
The great news however is…..we’ve “still” not missed a thing! and for those who’ve been slightly “wary” of the current trade environment ( wonderful…as you well should be ) a number of trade opportunities are not only “very much in play” but perhaps even “better looking” than some days or even weeks ago.
Let’s take a quick recap.
Short AUD/JPY here “again” at 95.00 or ( as I often suggest ) several pips lower and allow the market “momentum” come to you.
Re short GBP/JPY here at 171.80 area is the exact same entry we took some days ago then banked 200 pips on it! Exact same thing – right here right now.
With over 900 pips banked in the last 30 days, this is setting up pretty sweet for a complete and total “re run” as markets continue to hang at all time highs.
We’ve got piles of trades in the works now, with the “near to medium term analysis” in the bag.
Come trade with us at www.forexkong.net and get the full run down, weekly reports, daily commentary and real time trade alerts.
If you can believe it – the U.S Dollar has spent the entire last week “still hovering” near a well-known area of support, showing absolutely no interest in “getting off its ass” and making a move higher.
As forex markets have a tendency to move sideways for extended periods of time, this should come as no real surprise but in having held a number of small positions ( almost averaged out now ) “long USD” for some time now, I’m only giving it a couple more days before just “going with my gut” and likely pulling a “stop n reverse” – getting back on the short side of this dud.
The overall weakness and lack of any real “life” suggests ( as I’ve now suggested for some days ) that regardless of any “near term pop” – USD looks pretty much set on breaking support and continuing on its merry way – into the basement.
Considering the lack of movement ( in either direction ) scratching a trade that has consumed nearly two full weeks of trading doesn’t put a smile on my face. Not at all. If you consider the time and effort, and in turn the “lack of reward” you can easily see why we call this “work”.
I’ll give this dud a couple more days to “prove itself” but as it stands…..I’m a hair away from flat-out “stop and reverse”, wherein the probability of an actual “waterfall” exists.
It’s make it or break it time for USD. 4 days Max.
You can make light of a particular currency pair’s price level (such as AUD/JPY yesterday afternoon), as well point out its general connection / relationship / correlation with “risk appetite”, and BAM!
Perhaps it’s a touch too early to say, but I’m seeing reversal’s in just about every single pair I track with respect to a reversal in “risk appetite” – with both USD as well JPY showing strength here overnight.
Did I need to wake up and check SP futures? or perhaps tune into my local financial news this morning to get an idea of where U.S stocks may be headed here today? Nope.
Obviously I’m short AUD/JPY from yesterday, and will be adding a couple more long JPY ideas here today. The long USD’s I’ve got will be added to as well.
I can’t imagine another “triple digit gain” here in the U.S today, as this counter trend rally peters out.
There are literally “too many trade opportunities” for me to go over / list at present in that I am extremely busy managing all this.
If you can imagine how patient we’ve been with nearly the entire month of January passing, and “nary a trade” – this is really what trading forex is all about. You’ve got to hit it when the opportunity presents itself. The patience required is enough to drive a person mad “until” you’ve come to recognize market dynamics and movement over a considerable period of time.
I’d argue that I’ve not caught a decent “sustained and reliable trend” since the massive depreciation of the Japanese Yen a year ago, as trading has been extremely tough, choppy and directionless for months.
You slug it out, you keep your positions smaller, you take profits faster. You learn to take your foot of the gas in the corners, and then “hit it” in the straight aways.
It’s a skill sure, but as with anything – if you want to get good at something you have to stick with it. Even if you aren’t “actually trading” pulling up the charts day after day, studying the price action, watching for recognizable signs of reversal etc…It will come – but with a considerable learning curve.
Shit…even me – here over the past 24 hours, jumping around, banging my head against the wall cuz I jumped out / took profits too soon. Then back at the computer to “grind out” re-entry that may not be the best. Laying half awake with freakin “japanese candle sticks dancing round my head” wondering if I should plan to get up “another hour earlier” to make sure I’m in the trade.
I make mistakes too! But you have to stick with it. You have to get past the “mystery” and stay in the game long enough to see things more clearly.
And you can’t catch them all. Man……I’ll trade up to 15 pairs on a given move and still see massive trades pass me by! You’ve just got to “catch what you can” and only take on as much as you can handle.
Anyways, I’m back at it – and I hope at least a couple of you will consider what I’ve said. Go easy, take your time, study the fundamentals and trade smaller!!
I took another 3% profits and just as well may kick myself in the ass for not just hanging in but….these days I don’t really roll that way. Considering like 7% practically overnight and I think another 7% over the past week – It’s been 90% sitting in cash and 10% market exposure so…the Kongdicator tune up has been an improvement, and we “might” be into a larger move here.
Ill keep taking the money and running as you know how markets are these days – I’m certainly not going to suggest “investing”.
Ben hand’s off the bag to Yellen “with” a proposed “tapering”, and seals his legacy as one of the smoothest Central Bankers ever to have walked the Earth – or at least in the public eye.
I wonder what he’s gonna do with the next 20 years of his life? as it will likely be “more interesting to follow” than these last five.
You’d have to have rocks tumbling around in your head if you think that 85 billion is “all” the Fed’s been throwing at markets per month. I imagine it’s more like 150 billion or more as….the bond market is just too large to consider 85 billions per month having much affect.
Post announcement TLT is still sliding, and the U.S Dollar can’t even break even so……the big boys positions remain the same. MY POSITION REMAINS THE SAME.
The “effect” has merely been “the idea” (in traders / investors minds) that “they will never let the market fall”. If it took a number of 85 billion per month or 850 billion for that matter – it doesn’t really matter as the numbers manifest solely as “tiny computer entries” within a small group of friends.
A big “congrats” goes out to our beloved “Deano” for not only hitting the “tapering” right on the money….but also for “serving it up” like a true gentleman. If Deano owned a restaurant – I would eat there often.
For me? Another day of trading, and another day FULL of opportunities. Nikkei popping to 16,000 and USD certainly “not” moving higher on the news………..
USD “not” moving higher on the taper news??…..Hmm………..that’s a bit odd don’t you think?
You’ve been practicing, following along….learning the correlations etc…
Would you not have thought USD would “skyrocket” on taper news?
The combined “pips earned” across the board as of this morning (where I booked profits and reloaded 100% the exact same trades immediately) is now encroaching on 750 – 800 pips.
Not a bad day’s work to say the least…but again – after many, many , many hours planning as well placing smaller orders over time. It would be difficult to imagine someone executing a similar trade plan while keeping a fulltime job – away from markets and their trade desk.
The Australian Dollar being responsible for the largest part of it but “coupled” with continued EUR strength.
When you are fortunate enough to choose a given currency pair where movements in “both” currencies contribute to the move (as opposed to just one strength / weakness in one) wow! You can really see some serious action. This takes considerable fundamentals knowledge, not to mention timing, but when you get it right…….you can really “get it right”.
I do my best to Tweet as much of the “larger moves” as I can, but considering the number of trades and the “frequency of trades” when things are moving – it’s near impossible to catch every last wiggle. If you don’t get the tweets then most often conversation picks up IN THE COMMENTS SECTION AT THE BLOG.
I hope some of you have also managed to catch a “pip er two”.
Let today mark the last day I will comment on the subject, short of the possibility of small intermittent outburst throughout the coming years – as the need arises.
Have I completely lost my mind in quickly interpreting todays ” budget deal ” as being a complete and total waste of paper / time / energy ?
All I can make of it is that the “debt ceiling will be increased forever” and they’re just going to kick the can for an additional 10 years! Averting shutdown in Jan / Fed MUST mean debt ceiling raised no? ( And we can see that “markets” likely view this the same as Kong no? )
( There is no such thing as “the debt ceiling” by the way….but that’s another story)
Forgive me please but…….can an American citizen please explain to me how they can suggest that “a significant change to the pensions of federal government workers and the military will save $12 billion over 10 years, $6 billion each from civilians and the military, and much more over time”.
When 85 BILLION “PER MONTH” IS BEING PRINTED OUT OF THIN AIR!
There was just a little over $800 billion of base money in existence before the crisis in 2008… that’s 200 years worth of currency creation equaling 0.8 trillion
Now the Fed creates ONE TRILLION EVERY YEAR…meaning they are creating more than 200 years worth of currency……………… every single year!
Perceived “savings” stretched over “ridiculous periods of time” while 1 TRILLION DOLLARS ARE BEING PRINTED EVERY YEAR!
That’s it…..seriously….last post on it ( maybe not ) but……..common really?
Fantastic profits today in combination with trades initiated late last week…USD “continues” ( now 8 days in a row since posting ) to lose ground, Commods bounce and now reverse, EUR and GBP strength abound…and …..(wait for it…….wait for it……) JPY making the turn???
Habanero chasers for my fine tequilla tonight peeps….apparently …..I better practice up.
I’ve finally sold both EUR/USD as well GBP/USD, blowing out the EUR/AUD and NZD for the piddly gain of 2% on trades entered last Thursday.
I can’t say I’m particularly thrilled with either the performance “or” the current price action as a bounce in the commodity currencies took a couple of trades off track.
There is no fundamental driver for the smaller move up in both AUD and NZD, so I will be keeping my eye on near term resistance spots, to fade.
Considering that the US Dollar “has” continued to slide as suggested – picking your trades and your pairs hasn’t been as straight forward as one would imagine, with pairs like USD/CAD just “hanging” for days on end. The European currencies the obvious winners with the big moves vs EUR, GBP and CHF.
I’m more or less back in cash now as I would rather sit “outside the market” til at least a couple of things get straight. In general it looks like this will likely stretch out til the end of the year with equities making “one more last higher high” before rolling over into a mid-term decline.
The relationship of USD falling and gold catching a bid “is” coming along, but as suggested – no swinging for the fences down here please.
Oooops….I just reloaded both EUR/USD as well GBP/USD for additional shot at further upside, and will just lettem do their thing.
With all the high-flying stocks out there, and the endless promotion of “recovery in the U.S”, it gets harder and harder every day – to believe anything less. The media machines are in full swing, and the general census ( I believe something like 74% of analysts / newsletter writers ) suggest that the sun is shining, the water is warm – common everyone! It’s safe! Jump on in!
You know – I bet the majority of people “actually believe” that “miraculously” – the troubles in the EU Zone have all magically vanished as well! I’ve heard the floating heads on CNBC as well CNN state this as fact. Josh Brown ( a well-known floating head on CNBC ) looked me square in the eye the other day and stated that “the recession in the EU Zone was over”.
Some facts borrowed from Graham Summers:
1) The European Banking system is over $46 trillion in size (nearly 3X total EU GDP).
2) The European Central Bank’s (ECB) balance sheet is now nearly $4 trillion in size (larger than Germany’s economy and roughly 1/3 the size of the ENTIRE EU’s GDP). Aside from the inflationary and systemic risks this poses (the ECB is now leveraged at over 36 to 1).
3) Over a quarter of the ECB’s balance sheet is PIIGS (Portugal, Italy , Ireland and Greece ) debt which the ECB will dump any and all losses from onto national Central Banks.
So we’re talking about a banking system that is nearly four times that of the US ($46 trillion vs. $12 trillion) with at least twice the amount of leverage (26 to 1 for the EU vs. 13 to 1 for the US), and a Central Bank that has stuffed its balance sheet with loads of garbage debts, giving it a leverage level of 36 to 1.
The troubles in the EU are far from over, only masked during this “latest attempt” to ensure confidence in a system that is hanging precariously near the edge.
Keep in mind Spain’s currently unemployement rate is 25%!
The European Central Bank is currently considering ( and will soon likely implement ) a QE program of it’s own with bond buying and the works, similar to that of Japan and the U.S
This, coupled with “almost guaranteed” additional stimulus from the Bank of Japan has this currency war shifting gears moving forward, and leaves absolutely NO ROOM for tightening / tapering.
I will continue to complete ignore the media, as with the example sighted above……they are “paid” to keep the puppet show going.
So here we find ourselves up bright and early, with the birds chirping, and the palms rustling in the cool ocean breeze. It a beautiful morning here as the sun has just poked its head out – casting a “pinky blue” blanket across the sky. Truly heaven on Earth.
But – Hell in markets!
We’ve got the ECB announcement in 15 minutes which ( regardless of what you are lead to believe ) has much larger implications / market moving potential than any of the usual “phony numbers” on U.S employement – also scheduled an hour or so later.
The European Central Bank ( after the “supposed recovery” – ya right! ) is now considering some form of monetary easing of its own as the recent rise in EUR/USD has hampered growth/exports etc….
If by the odd chance The ECB “does” announce motions to ease ( or perhaps issues forward guidance to telegraph such a move ) watch USD shoot further for the moon , and the EUR to tank.
I’m adding long USD in and around the announcement.