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Trading the Financial Markets
#76

Trading the Financial Markets

Quote: (02-16-2012 01:45 AM)Entropy Wrote:  

this is the level that i am watching in the EURGBP 0.8294.

UPDATE #1
Doing an update on eur/gbp....entry was at 0.8279 at the point of confluence of S/R and TL..... the S/R level that i was watching is at 0.8294/91

chart attached.
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#77

Trading the Financial Markets

Quote: (02-16-2012 02:53 PM)Entropy Wrote:  

Quote: (02-16-2012 01:45 AM)Entropy Wrote:  

this is the level that i am watching in the EURGBP 0.8294.

UPDATE #1
Doing an update on eur/gbp....entry was at 0.8279 at the point of confluence of S/R and TL..... the S/R level that i was watching is at 0.8294/91

chart attached.

Update #2. Price is now at 0.8314...which is +24 pips gain above S/R level of 0.8294...but +34 gain in profit above entry point of 0.8279. At 0.8314 it is only 3 pips away from my initial B/E point of 0.8316. Why did i adjust my B/E point? Well, i will need to head over to my silly 9-5 job. Otherwise, it is a rule that when the trade is set and all the contingencies have been planned, unless in the event of a major macro event, never break discipline. Stick to your plan through hail and hellfire.
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#78

Trading the Financial Markets

Quote: (02-15-2012 02:08 PM)Entropy Wrote:  

Quote: (02-15-2012 11:10 AM)Entropy Wrote:  

EUR/CAD long position at 1.3022. Yes, i know, i said i was done for the day after the successful AUD/JPY short...but i just saw this a few minutes ago...and i just couldnt pass it up...i took a long position in it immediately. We will see how it goes. Annotated chart attached below.

1ST UPDATE: Price has moved bullishly up by +36 pips in profit to the B/E point...which means the SL has been readjusted from -25pips to +5pips to protect against any retracement. TP is still 1.3190. The trade is in set-and-forget mode...that is, worst case scenario i will make +5pips profit...best case scenario i will make +168 pips in profit to give a 6.72R on risk.

original setup chart here.

update chart attached below:

think i should do a little update on long EUR/CAD....it is now up by +70pips in profit.

chart attached below:
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#79

Trading the Financial Markets

Quote: (02-16-2012 02:40 AM)julio26 Wrote:  

From my analyst this morning:

Short term EUR/USD technicals have turned bearish (although still unconfirmed). They are now allied with most medium term indicators, which appear bearish, all except for regression analysis. Spot has shown bearish divergence at recent highs (with falling momentum), while the daily MACD has crossed below its signal line from overbought levels. If spot starts closing below 1.3023, then such signals will have been confirmed, so targeting January lows around 1.2624.


Quote: (02-16-2012 03:11 AM)julio26 Wrote:  

Anyways, it is easy to panic about Greece in the forex market, BUT so far this morning GILTs have not soared at all. Even though FTSE100 is slightly softer, there is no panic on Gilts. And so far NO PANIC on Bunds, so I am careful about selling EUR/USD to bits on the downside, even if that is the likely trend for the day.


Julio26,
I have some stuff to say about using the indexes, bonds yield fluctuations, commodity prices to gauge market sentiment about risk on/risk off on a daily basis.....I have been neglecting that to the side on this thread.

YES, fundamentals can be use to daytrade or swing trade too.(as you probably well know). Not just technicals.

Your post about GILTS and FTSE100, julio26, motivates me to want to write about how i go about using fundamentals to daytrade/swingtrade. How i go about using these as indicators in charting the direction of the trading day from a fundamental point of view. I will probably write more about that, either (a)when i come back from my 9-5 purgatory of job(around 1:30am EST) or (b) Over the weekend....

I have to admit my guilt in this: i have been neglecting to post on the active use of fundamentals, or market sentiments using euro-futures, for that matter, to gauge market direction.

As for now, the drudgery of 9-5 awaits....need to head out.
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#80

Trading the Financial Markets

IMF and european bailout.

Excerpts from a trading journal:45Condor

In the particular instance of providing loans to Europe, it goes something like this.
You pay your taxes – which come in many forms – to your government, who then pay back X amount to their lender – the FED, which we all know is a private company, and not a department of the government - don’t be fooled with the Federal in the title – and also to the IMF through a quota system for those countries that are members. Most developed countries ‘donate’ X amount to the IMF. The IMF then decide whose begging bowl they will feed, and as we all know, this comes with very strict payback conditions that are always met by the taxpayer, whilst the, in many cases, dictators holding the bowl, have millions stashed in a Swiss bank account, and properties along the French Riviera. Ever wondered what those that ‘donate’ receive in return? It is a very interesting research project for one to conduct whilst waiting for the pip set-up to manifest itself, and I would recommend the exercise to anyone.

What is currently happening is that your tax Dollars are not being spent on the school for your children, the medicine for the care of your children, or the condition and security of the suburbs for your children through non-Stalinist law enforcement, but on bailing out criminals in high places. That is, banks and politicians who have squandered trillions, cocked up, and then forced the government to rape the taxpayer even more. In this case, it looks like a double rape if the IMF go ahead with bailing out the countries of Europe. Oh, and your Dollars also help to pay for $3000 a night sex parties and goodness knows what else for top officials of an institution that is supposedly in place to help the poor. And if you think Dominique Strauss-Kahn cannot afford to pay for this himself, consider this: his family fortune is estimated to be in the region of $100 Million. It is also an interesting exercise to research what happens in Oxfam and so on. I no longer donate cash to any charity, but instead buy food at the local supermarket and then take it to local food kitchens and such for those that are not as fortunate as me.

So, Wall Street, The Square Mile, Bankfurt, Nihombashi and so on, and so on, and so on, are afraid that the money already poured into the swill back in 2008 – by the tax payer - will be lost if countries just default… something the big boys are trying desperately to avoid; witness the forced removal of democratically elected leaders of countries, and I'm not talking some tin-pot banana republic, or ‘our man gone rouge’ Middle Eastern/North African dictator, but supposedly mature democracies such as Greece and Italy, and replaced by technocrats that are not elected, and have in former posts all served the European Commission (another undemocratic, unelected and unaccountable entity that tells the public nothing other than what the shape of a banana should be if being sold on a fruit stall in Europe, or more recently, that producers of drinking water cannot put on the bottle that water helps to avoid dehydration – that is not a joke, check recent news outlets).

Now, take a moment to understand what has just happened to these two countries.; one the assumed birthplace of democracy, the other, the assumed epitome of a modern civilized lifestyle with an economy recently ranked around 11th in the world, have just been forced, using your Dollar via FED interests, (and my Pound and Euro given my particular circumstance, and anyone else's currency if reading from a country that is involved in financing bailouts – so pretty much everyone) to forego many millennia of democratic growth, in order for the technocrats to move in, impose fiscal reform, and rape the taxpayer.

Lets go back a few years to round one of raping the taxpayer. Governments give money to the banks – keeping the ‘old-boy’ system in place – and then tell us all that all is well. We don't like it, cannot do anything about it, and so have to accept it, we are told, in order to maintain our current way of life, which isn't that bad, and that we can accept a little hardship if only to preserve our countries. We hope the perpetrators of the financial crimes – and that is what they are – would be held accountable. They weren't, but assurance is given by those that come to us every four or five years and pretty much force us to vote in order to lend legitimacy to their fascist regimes that the system is stable once more. Well, not too long after this it becomes blatantly clear that all is not well, and I, and I guess a lot of other people, suddenly see bank charges going up and savings’ rates going down, even though I was forced to give that bastard money not so long ago to get them back on their feet, whilst that same bastard then stole my comfy shoes and gave me dog-bitten slippers to wear. So, a few years ago your Dollar did not go to serve you, but some f*&%er sat in a high office in a foreign land, in order to protect his bonus before he or she gave any thought to paying his lender back. That's you. And you did not have any say in where your Dollar was channelled, and was most certainly not were any right-thinking person expected it to go.

A few years later, and higher tax and bank costs to you, that same f*&%er is still ensuring that he receives his bonus – and now we are back to pre-2008 bonus levels (higher) – and you are now going to be forced to give more Dollars. The only difference now is that your Government is broke, the FED are petrified of losing their first ‘investment’, and so the real players in the world of commerce are telling Governments that it's time for another rape of the taxpayer otherwise the whole system will come crashing down. Of course, Government cannot do anything, and so the IMF knock on the door. They will give you a loan - with your money, let's not forget - but you will have to accept having less money in your pocket by way of higher taxes, less public services, etcetera.

So, if Italy is bailed out by the IMF, it will be with money already given by the Italian taxpayer, and you, and me, and most other people reading this post. The Italians will suffer the most as they will have to take a bigger cut in living standards(IMF loan conditions on fiscal adjustments to country-specific policies) in order to receive back their money… oh, and they, and by donation-association, the rest of us, will be expected to pay interest on this giving back of money that was once ours, to those that we gave the money to in the first place, with no interest paid to us (taxpayers) whilst they had it in their pocket.

I found this a very interesting video, and very much recommend watching it… even for us non-US citizens.




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#81

Trading the Financial Markets

Differences in labour class.

japan, south korea and the rest of the western world have innovative labour class: they have sophisticated, well-educated labour/entrepreneuring class that produces ideas and innovations. These highly sophisticated labour class invents computers and their software; complex, utilitarian electronic gadgets, cars, medical diagnostic tools, social networking apps, web 2.0 technology, medical and pharmaceutical palliatives, etc. Basically, new breakthrough in technology and science in the R and D department of corporations and universities from oxford to ecole polytechnic to harvard to university of toronto, that will later spurs new products for consumers and creature comforts. That is what the developed nations have in terms of labour.

On the other hand, mexico, Malaysia, kenya, mongolia, china and india mostly have less sophisticated labour class that helps mass produce the ideas of the West to make it available cheaply. Yes, i know, china and india and brazil are seriously playing catchup with the developed nations.

What the developed nations bring to the table in terms of labour is innovative, entrepreneuring labour that produces inventions and ideas for the modern world; what china and india and mexico brings to the table is cheap, cost-effective human capital that allows the developed nations to mass produce their inventions and ideas as products on a cheaper, affordable level.

For the developed nations, how do you become competitive with mexico and china with regards to cheap avoidable labour without sacrificing your innovative, highly educated labour class that gives you an innovative edge?

For china, india and mexico: how do you match and beat the developed countries in terms of innovation through creating a highly educated and sophisticated labour class, all the while, without sacrificing the cheapness of your labour?
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#82

Trading the Financial Markets

I think i should post some graphics showing the shit we are in.

[Image: attachment.php?attachmentid=898483&stc=1&d=1329257777]

here is another one:

[Image: Euro+Debt+Crisis+NYT.png]
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#83

Trading the Financial Markets

PIPTRAPPER did the labour of assembling this together...

EU Crisis (Key Dates):

--Monday, Feb. 6: Italian parliament must have approved government's fiscal, growth package by this date. French and German leaders meet in Paris.

--Tuesday, Feb. 7: Greek T-bill auction.

--Wednesday, Feb. 8: German bond auction.

--Thursday, Feb. 9: ECB interest-rate statement, press conference. Greek parliament may adopt legislation to retrofit Greek bonds with collective action clauses.

--Friday, Feb. 10: EUR1 billion in Greek debt maturing.

--Monday, Feb. 13: Deadline for formal Greek PSI bond exchange offer. Italian T-bill auction.

--Tuesday, Feb. 14: Italian BTP auction. Greek and Spanish T-bill auctions. German February ZEW economic sentiment indicator.

--Wednesday, Feb. 15: Portuguese T-bill auction. Flash data on fourth-quarter E.U. gross domestic product.

--Thursday, Feb. 16: French and Spanish bond auctions. Spain fourth-quarter final gross domestic product data.

--Friday, Feb. 17: EUR1.6 billion Greek T-bills maturing.

--Monday, Feb. 20: Euro-zone finance ministers meet. Flash euro-zone February PMI data.

--Tuesday, Feb. 21: European Union finance ministers meet. Spanish T-bill auctions.

--Wednesday, Feb. 22: German bond auction.

--Thursday, Feb. 23: German February Ifo business climate index.

--Friday, Feb. 24: Italian bond auction.

--Saturday, Feb. 25: Group of 20 finance ministers, central-bank governors meet.

--Monday, Feb. 27: Belgian bond auction, Italian T-bill auction.

--Tuesday, Feb. 28: ECB three-month, three-year long-term refinancing operation. Italian bond auction. Date by which analysts expect decision by Irish Attorney General on whether it will have to schedule a public referendum on the European Union's new treaty.

--Wednesday, Feb. 29: EUR10.6 billion of Italian CTZ bonds mature. German bond auction.

--Thursday, March 1: EUR14.9 billion of Italian BTP and EUR12.3 billion CCT bonds mature. Euro-zone February manufacturing PMI data. Spanish and French bond auctions.

--Friday, March 2: E.U. leaders summit.

--Monday, March 5: Euro-zone February services PMI data.

--Tuesday, March 6: Revised E.U. fourth-quarter GDP growth data. Greece targets to complete PSI bond exchange by this date.

--Wednesday, March 7: German bond auction.

--Thursday, March 8: ECB interest rate decision. German January industrial production data.

--Monday, March 12: Euro-zone finance ministers meet.

--Tuesday, March 13: German March ZEW economic sentiment indicator. Italian and Greek T-bill auctions.

--Wednesday, March 14: Italian bond auction.

--Thursday, March 15: Spanish and French bond auctions.

--Tuesday, March 20: EUR14.4 billion of Greek government bonds mature. Spanish and Greek T-bill auctions.

--Wednesday, March 21: German bond auction.

--Thursday, March 22: Flash euro-zone March PMI data.

--Monday, March 26: German March Ifo business climate index. Belgium bond auction.

--Tuesday, March 27: Spanish T-bill auction. Italian bond auction.

--Wednesday, March 28: ECB three-month long-term refinancing operation. Italian T-bill auction.

--Thursday, March 29: Italian bond auction.

--Friday, March 30: Euro-zone finance ministers meet.
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#84

Trading the Financial Markets

FUNDAMENTAL analysis resources. I am indebted to piptrapper for 90% of this. He concisely put it together.

Aggregate economic news feed in realtime.

Quick overview of fundamental analysis of the forex market.

Global economy library.

Exhaustive economic data for trading from countries around the world

COMPANIES EARNING calendar.


CONDENSED weekly fundmental analysis and reviews from all the brokerages.


kathy lien analysis

zerohedge analysis .

john mauldin analysis

Marc chandler analysis

Where you can find the different latest 10yr government bond rates.

Federal Reserve Foreign Exchange Swap Agreements

Futures of indexes and commodities.

Overview of COT data analysis

More explanatory notes on COT data/analysis.


TIMING CHARTS SHOWING COT AND FUTURES.

overview of risk on/risk off in currency trading

More on risk on/risk off aspect of fundmental analysis.

Risk On, Risk Off and the Gold Trade

Primer on QUANTITATIVE EASING and BONDS.



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#85

Trading the Financial Markets

Active use of risk on/risk off. KHG approach. excerpts:

I suggest you will see certain pattens everyday that repeat in forex with some exceptions. It has to do first of all with the end of the Asia session which usually gets going around 7:00 PM EST as different time zones kick in and it is in full bloom by 10:00 PM EST.

Things have settled down by 11:00 PM EST and then there is usually not much activity until the time frame you refer to.

2:00 AM EST is when I wake up and start my trading day. We start to get the retail trader's from Europe coming on board. The bank trader's and currency houses start coming into work.

Then at 3:00 AM the FTSE and the DAX and the other's open for trading. There is news out overnight from the various newspapers and of course the Dow futures are showing a direction at that time.

As orders get filled by the bigger players and news is filtered in as the open of trading starts at 3:00 AM EST and if there is new fundamental facts then the stock markets react accordingly. As the money moves in and out of the stock markets they flow into other asset classes such as Gold, Oil and the various European Bonds. The money flow is what moves the charts along with support and resistance levels being factored in.

This happens again at about 7:00 AM EST at the start of the markets opening in North America.

There is the morning newspapers, the digesting of the data out of Europe overnight and of course the talking heads on CNBC along with all the experts. (Joke)

Then at 8:30 AM EST there is data releases in the USA and Canada and the tone is set for the day.

The markets start at 9:30 AM EST and as money flows into and out of the Dow, SP500 it goes elsewhere as well into Gold, Oil, US Bonds and this gets extreme if we have a Risk on or Risk off day.

If the Dow does go down on Monday another 300 points of course I also include the SP500, the money usually leaves EUR/USD and if there are margin calls and other factors and Gold gets sold as well. This might happen as US DX gets stronger Gold might react accordingly.

The money then flows into US Dollars and then the only Safe Place (Not For Much Longer) the US Bonds. I watch the 2 Year US Bonds and the 10 Year US Bonds. As the price of the US Bonds go up with the parking of money then the Yields go down.

That is the opposite of what is happening in Italy, Germany and other PIIGS at the moment as their Bunds or whatever sell off the money goes to the safety of US Bonds.

The charts are always moved from the money flow. You can confirm this for yourself by watching the money flow yourself. I never trade without having CNBC in front of me or any similar source of information that shows me the price of Gold, Oil, US Bonds (In North America Session) an the other currencies such as EUR/USD, EUR/JPY, USD/JPY, GBP/USD and USD/CHF.

USD/CAD moves depending on price of Gold, Oil, The markets move USD/CAD with Risk On or Off and of course the strength of the DX which is 57.6 % made up of EUR/USD.

I hope this post proves useful and this upcoming week might be some week with all the new data coming out including NFP on Friday along with the MESS in Europe.

____CONTINUES___

Since you mentioned actively watching the behaviour of oil and gold and how that helps in reviewing the behaviour of USD/CAD...due to the fact that...well, CAD is a commodity dollar...do you factor that in play too when trading the NZD and the AUD...since they are commodity dollars too?

Kno:

When you trade USD/CAD while it is a commodity currency it also behaves as relates to the USA with regard to risk on or risk off and also with regard to the state of the US economy.

I do not trade USD/CAD very often unless I see a special situation.

I specialize in EUR/USD

I trade USD/JPY at times again when I see a new opportunity present itself.

At the present time there is announced INTERVENTION in USD/JPY if it goes below 76.00 and the same now with USD/CHF.


What role do china fits into your fundamental picture in all of this? Or do you think agricultural products like milk and wool drives NZD more?

Kno:

The only commodities that move the markets is Oil and Gold and I ignore the rest.

China has a big role since they hold over One Trillion in US Dollars and they are slowly moving into Gold and other hard assets.

They have been funding Europe quietly however they always take Gold as collateral for obvious reasons.

Do you use the correlation between the SP500 with USD/JPY to trade?

Kno:

I definitely use the SP500 and Dow to follow the money flow. On most days there is a correlation mainly through Risk on and Risk off.

As I pointed out before when the Dow sells of 250 or more you will see money leave EUR/USD and other currencies as sales of stocks then end in cash and the cash whether in EUR/USD or another currency such as GBP/USD finds it's way to US Dollars in order to buy the short term US Bonds. I follow mainly the yield on the 2 Year US Bonds and the 10 Year US Bonds. As the money flows into the US Bonds you can see the Yields go down and that tells me where money is being parked short term.

You can see the same thing happening in Europe now as the Bunds and other Europe Bonds sell off and the Yields go over 7% and danger signs like just happened in Italy on Friday.

USD/JPY is also a place money is parked when there is Risk on however there is always the danger now of INTERVENTION below 76.00 so I do not trade it now as the range now is 75.50 to 78.00

How about when there is a divergence in correlation, direct or inverse...with the usual suspects of SP500/GOLD/OIL/BONDS against currencies....in what direction do you weight your fundamental views...what parameters/conditions/criteria do you use to weight them?

Kno:

I just watch which way all the money is following and understanding other factors such as Risk on or off and now there is NEW FACTORS such as a breakdown in the Eurozone and INTERVENTIONS to keep some order.

I do much reading and research to understand what is really happening.

Things are changing everyday so you need to watch price action and how a currency reacts to news.

As an example if the Dow is down 250 or so and EUR/USD is also down if in the middle of the day Bernake makes some comment about New QE or a form of Stimulus the Dow might reverse 150 in moments. As that happens Risk comes back on and US Bonds are now sold and the reverse effect takes place. EUR/USD can rally 50 to 75 PIPS.

Nothing has really changed for the moment other than new spin.

The same happens in Europe everytime Merkel and Sark KISS and make up.

There is new leaders in Greece and Italy and things are getting worse not better.

The short term hope gave it a boost however as Bunds and other Bonds sell off and more and more traders (THE BIG ONES) realize next comes a real default and maybe the end of the Eurozone as we know it the markets vote by putting their money in safer places.

PERCEPTION moves the markets until FUNDAMENTALS give the WAKE UP CALL such as the Germany Bond Auction going bad and then the cost of money in Italy going over 7%.

We are now in a REALITY MOOD until more SPIN comes out of Europe.

The USA will be affected through their Banks which are insolvent. They have liquidity however they need to use it once their real losses are revealed.

The race is to the bottom for the FIAT currencies and China is waiting for their opportunity. The recent debacle of November 23, 2011 did not help the USA situation and soon there will be another downgrade from AA Plus to AA and it will also include Moody's and Fitch.
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#86

Trading the Financial Markets

the EUR/CAD and the EUR/GBP are still kicking...but i am done for the week...it is time for the weekly report. This week i have 17% return on risk.

Last week was 12.64R on risk.. THIS WEEK IS 17R.

Anyways, to celebrate the end of the trading week(i have b/e all trade for the weekend)....to celebrate making 17% return on total net of trading asset, i present:

[Image: tumblr_lbrmomUTln1qeif2co1_400.jpg]

And of course:
[Image: tumblr_lbrn7jFLvq1qeif2co1_500.jpg]

this will not be complete with a song that captures my mood:





and this romney shit:
[Image: Bain.jpg]
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#87

Trading the Financial Markets

Last update on EUR/GBP.

Liquidated position at 0.8331 for +53pips profit. = 2.12R. That changes my weekly report for this week from 17R to now 19.12R. [Image: banana.gif] [Image: banana.gif] [Image: banana.gif] [Image: banana.gif]
(on a side note, eur/cad has moved up by +100pips into profit from entry point to a tune of 4R )

Anyways, on eur/gbp.

Initial ENTRY chart that started it was here.

1st update chart here as the trade progresses into profit.

final chart below:
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#88

Trading the Financial Markets

the week ahead in forex by brian nolan.

--Greece’s day of reckoning is only the start
--Further JPY-weakness may be in store
--Light US data may see risk rally stall

"Greece’s day of reckoning is only the start

Another week and another Greek deadline has come and gone. But EU leaders have vowed yet again that a final decision will come on Monday, and this time they really, really mean it. Except that they’re still working over the weekend on the final details of the accord, so yet another impasse or breakdown could materialize. But we’ll give them the benefit of the doubt and expect that EU finance ministers will approve the second bailout, likely requiring some form of escrow account. Such an arrangement will set the stage for further showdowns in the months ahead, as Greece will repeatedly need to meet deficit reduction targets to obtain subsequent aid disbursements, and their track record there is not good.

While we think the Eurogroup will approve the next Greek bailout on Monday, we can’t rule out last minute hang-ups on key issues, potentially pushing the decision into the March 1-2 EU Summit. Eurogroup officials will meet informally on Sunday night and begin the formal session around 1430GMT on Monday. If they do approve the bailout, we would look for risk assets (stocks and commodities) and EUR to make yet another minor relief rally. Clearly, if they don’t approve of the aid, we would expect risk markets and EUR to come off relatively hard, as the risk of a disorderly default would be intensified. The ultimate deadline to keep in mind is the March 20 maturity of EUR 14.5 bio in Greek government debt.

While much attention has been focused on the question of whether Greece will or won’t receive the second bailout package and avoid a default, we think the bigger risks are from the fallout over the Greek debt swap deal with private sector investors (PSI). In this situation, we are looking at many so-called ‘known unknowns.’ This stems from the credit default swaps on Greek government debt and whether they will be triggered, which financial firms are on the hook for them, and for how much.

The current terms of the PSI negotiations strongly suggest that a ‘credit event’ will be declared, but ultimately that’s up to a committee of ISDA (International Swaps Dealers Association, the CDS and derivatives industry self-regulatory body) to determine. However, reports circulating on Friday indicated that some private creditors were already preparing legal action against the Greek government over the amount of losses they’re being forced to swallow. Friday also saw the Greek government announce that it’s preparing a ‘collective action clause’ law (CAC) for outstanding Greek government debt. CAC’s permit a super-majority of bond holders to alter the terms of existing bonds, making the debt swap deal a non-voluntary affair. Various credit rating agencies have indicated imposition of CAC’s would constitute a ‘credit event’, likely triggering CDS payouts. This brings us back to the known unknowns of which financial firms are liable and for how much, potentially sparking global financial sector upheaval as investors retreat to safe havens. And then there are the ‘unknown unknowns,’ where we don’t know what we don’t know. For many, this is the bigger risk out there, potentially making the fallout from the Greek debt deal make Lehman look like a walk in the park.

Overall, we think a resolution to the Greek rescue drama next week may simply be the start of a larger, messier drama involving previously unentangled financial institutions globally. At the minimum, we would expect a deal on Greece to offer only a short-lived respite, before markets begin to question anew the sustainability of Greece over the longer haul.

Further JPY-weakness may be in store

The JPY has undergone a distinct adjustment lower versus other major currencies over the past week following the BOJ’s decision to initiate another round of QE and establish an inflation target of +1.0% (latest CPI was -0.3%), suggesting more QE will be needed in the future. Together with Japan’s trade surplus evaporating into a deficit (January trade data due out on Monday morning in Tokyo; adjusted trade deficit of –JPY 850 bio expected), we think there is scope for further JPY weakness in the weeks ahead. Anecdotal reports also suggest Japanese investors started to actively reduce their portfolio hedges, leading them to buy foreign FX and sell JPY, adding yet another flow to JPY-selling pressure.

USD/JPY and many of the JPY-crosses have reached 3-month highs and are testing key resistance levels, such as USD/JPY 79.50/80.00 and EUR/JPY 104.50/105.00. While we think there is further upside in store, we would avoid getting long at these levels and prefer to wait for a pullback to pursue long entries (selling JPY), ideally around 78.00/50 in USD/JPY and 102.70/103.20 in EUR/JPY. Breaks above the resistance zones mentioned above may see JPY-pairs move directly higher in this adjustment. Potential turmoil emanating from Europe next week could provide the desired pullback, if investors turn back to the JPY and the USD on safe haven demand.

Light US data may see risk rally stall

Next week sees the US President’s Day holiday on Monday where US stock and futures markets will be closed. The rest of the week sees relatively minor US economic data (existing/new home sales; weekly jobless claims) only late in the week. We note this because the risk rally currently underway has been extremely tentative and seems to require frequent injections of better-than-expected news and data to keep going. More positive US data reports of late have been a primary source of that optimism, but with minimal data out of the US next week, that medicine may be in short supply. Together with potential disappointment or outright disarray out of Europe, we would not be surprised to see a more negative correction to risk assets and a further bounce for the USD. "
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#89

Trading the Financial Markets

A trading week begin anew. Last week gain was nice.

May the trading gods bless this week with abundance...or, i will kill the gods and sacrifice them on my altar and piss on valhalla.

To celebrate the beginning of a new trading week. Here is the eye candy:

[Image: tumblr_lzlo1iJw641qjdnyzo1_1280.jpg?AWSA...MKJEO6s%3D]
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#90

Trading the Financial Markets

Quote: (02-17-2012 10:12 AM)Entropy Wrote:  

Last update on EUR/GBP.

Liquidated position at 0.8331 for +53pips profit. = 2.12R. That changes my weekly report for this week from 17R to now 19.12R. [Image: banana.gif] [Image: banana.gif] [Image: banana.gif] [Image: banana.gif]
(on a side note, eur/cad has moved up by +100pips into profit from entry point to a tune of 4R )

Anyways, on eur/gbp.

Initial ENTRY chart that started it was here.

1st update chart here as the trade progresses into profit.

final chart below:



UPDATE ON eur/gbp. 2ND price target reached for +75 pips.(chart attached). that gives an R/R of 3R. That is 3% return on this trade...I have attached 4charts showing the progression of the trade as it goes into profit.

SETUP CHART that begins it was here

[Image: attachment.jpg4777]

1ST UPDATE CHART is here

[Image: attachment.jpg4778]

2nd update chart is here

[Image: attachment.jpg4789]

the last one is below for profit +75 pips:
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#91

Trading the Financial Markets

Quote: (02-15-2012 02:08 PM)Entropy Wrote:  

Quote: (02-15-2012 11:10 AM)Entropy Wrote:  

EUR/CAD long position at 1.3022. Yes, i know, i said i was done for the day after the successful AUD/JPY short...but i just saw this a few minutes ago...and i just couldnt pass it up...i took a long position in it immediately. We will see how it goes. Annotated chart attached below.

1ST UPDATE: Price has moved bullishly up by +36 pips in profit to the B/E point...which means the SL has been readjusted from -25pips to +5pips to protect against any retracement. TP is still 1.3190. The trade is in set-and-forget mode...that is, worst case scenario i will make +5pips profit...best case scenario i will make +168 pips in profit to give a 6.72R on risk.

original setup chart here.

update chart attached below:



tt

Just think i should do a nice update on EUR/CAD.....up by +136pips now....that is already 5.44R
chart update attached below with annotations:
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#92

Trading the Financial Markets

Quote: (02-20-2012 07:55 AM)Entropy Wrote:  

Quote: (02-15-2012 02:08 PM)Entropy Wrote:  

Quote: (02-15-2012 11:10 AM)Entropy Wrote:  

EUR/CAD long position at 1.3022. Yes, i know, i said i was done for the day after the successful AUD/JPY short...but i just saw this a few minutes ago...and i just couldnt pass it up...i took a long position in it immediately. We will see how it goes. Annotated chart attached below.

1ST UPDATE: Price has moved bullishly up by +36 pips in profit to the B/E point...which means the SL has been readjusted from -25pips to +5pips to protect against any retracement. TP is still 1.3190. The trade is in set-and-forget mode...that is, worst case scenario i will make +5pips profit...best case scenario i will make +168 pips in profit to give a 6.72R on risk.

original setup chart here.

update chart attached below:


Just think i should do a nice update on EUR/CAD.....up by +136pips now....that is already 5.44R
chart update attached below with annotations:


EUR/CAD reach target for +152 pips. I did what i generall dont do:re-assess profit target. I think in this case it was warranted. Anyways, risk was -25pips and gain was +152 pips, which translates into 6.08R on risk.

Since i risked only 1% of net...this generated 6.08% return on investment in this trade.

Combine this with the EUR/GBP exit for 3R...that makes 9.08% return for the day.

Anyways, EUR/CAD charts with annotations attached below:
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#93

Trading the Financial Markets

EUR/CAD...closed for +152 pips profit = 6.08 R

here is the breakdown....

the initial setup that started this trade. I entered and use -25pips as my risk:

[Image: attachment.jpg4750]

The continuation of the trade part 1 as it moves into profit by +36pips

[Image: attachment.jpg4755]

As the trade continues and moves into profit by +70pips.

[Image: attachment.jpg4779]

As the trade goes even higher and moves into profit by +136pips.

[Image: attachment.jpg4837]

As the trade moved into profit by +152pips and i closed it; after reassessing my initial profit target of 168pips :

[Image: attachment.jpg4847]
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#94

Trading the Financial Markets

Quote: (02-20-2012 05:25 PM)Entropy Wrote:  

EUR/CAD...closed for +152 pips profit = 6.08 R

here is the breakdown....

the initial setup that started this trade. I entered and use -25pips as my risk:

[Image: attachment.jpg4750]

The continuation of the trade part 1 as it moves into profit by +36pips

[Image: attachment.jpg4755]

As the trade continues and moves into profit by +70pips.

[Image: attachment.jpg4779]

As the trade goes even higher and moves into profit by +136pips.

[Image: attachment.jpg4837]

As the trade moved into profit by +152pips and i closed it; after reassessing my initial profit target of 168pips :

[Image: attachment.jpg4847]
Reply
#95

Trading the Financial Markets

Quote: (02-20-2012 07:35 AM)Entropy Wrote:  

Quote: (02-17-2012 10:12 AM)Entropy Wrote:  

Last update on EUR/GBP.

Liquidated position at 0.8331 for +53pips profit. = 2.12R. That changes my weekly report for this week from 17R to now 19.12R. [Image: banana.gif] [Image: banana.gif] [Image: banana.gif] [Image: banana.gif]
(on a side note, eur/cad has moved up by +100pips into profit from entry point to a tune of 4R )

Anyways, on eur/gbp.

Initial ENTRY chart that started it was here.

1st update chart here as the trade progresses into profit.

final chart below:



UPDATE ON eur/gbp. 2ND price target reached for +75 pips.(chart attached). that gives an R/R of 3R. That is 3% return on this trade...I have attached 4charts showing the progression of the trade as it goes into profit.

SETUP CHART that begins it was here

[Image: attachment.jpg4777]

1ST UPDATE CHART is here

[Image: attachment.jpg4778]

2nd update chart is here

[Image: attachment.jpg4789]

the last one is below for profit +75 pips:
Reply
#96

Trading the Financial Markets

Quote: (02-18-2012 10:49 AM)Entropy Wrote:  

the week ahead in forex by brian nolan.

--Greece’s day of reckoning is only the start
--Further JPY-weakness may be in store
--Light US data may see risk rally stall

"Greece’s day of reckoning is only the start

Another week and another Greek deadline has come and gone. But EU leaders have vowed yet again that a final decision will come on Monday, and this time they really, really mean it. Except that they’re still working over the weekend on the final details of the accord, so yet another impasse or breakdown could materialize. But we’ll give them the benefit of the doubt and expect that EU finance ministers will approve the second bailout, likely requiring some form of escrow account. Such an arrangement will set the stage for further showdowns in the months ahead, as Greece will repeatedly need to meet deficit reduction targets to obtain subsequent aid disbursements, and their track record there is not good.

While we think the Eurogroup will approve the next Greek bailout on Monday, we can’t rule out last minute hang-ups on key issues, potentially pushing the decision into the March 1-2 EU Summit. Eurogroup officials will meet informally on Sunday night and begin the formal session around 1430GMT on Monday. If they do approve the bailout, we would look for risk assets (stocks and commodities) and EUR to make yet another minor relief rally. Clearly, if they don’t approve of the aid, we would expect risk markets and EUR to come off relatively hard, as the risk of a disorderly default would be intensified. The ultimate deadline to keep in mind is the March 20 maturity of EUR 14.5 bio in Greek government debt.

While much attention has been focused on the question of whether Greece will or won’t receive the second bailout package and avoid a default, we think the bigger risks are from the fallout over the Greek debt swap deal with private sector investors (PSI). In this situation, we are looking at many so-called ‘known unknowns.’ This stems from the credit default swaps on Greek government debt and whether they will be triggered, which financial firms are on the hook for them, and for how much.

The current terms of the PSI negotiations strongly suggest that a ‘credit event’ will be declared, but ultimately that’s up to a committee of ISDA (International Swaps Dealers Association, the CDS and derivatives industry self-regulatory body) to determine. However, reports circulating on Friday indicated that some private creditors were already preparing legal action against the Greek government over the amount of losses they’re being forced to swallow. Friday also saw the Greek government announce that it’s preparing a ‘collective action clause’ law (CAC) for outstanding Greek government debt. CAC’s permit a super-majority of bond holders to alter the terms of existing bonds, making the debt swap deal a non-voluntary affair. Various credit rating agencies have indicated imposition of CAC’s would constitute a ‘credit event’, likely triggering CDS payouts. This brings us back to the known unknowns of which financial firms are liable and for how much, potentially sparking global financial sector upheaval as investors retreat to safe havens. And then there are the ‘unknown unknowns,’ where we don’t know what we don’t know. For many, this is the bigger risk out there, potentially making the fallout from the Greek debt deal make Lehman look like a walk in the park.

Overall, we think a resolution to the Greek rescue drama next week may simply be the start of a larger, messier drama involving previously unentangled financial institutions globally. At the minimum, we would expect a deal on Greece to offer only a short-lived respite, before markets begin to question anew the sustainability of Greece over the longer haul.

Further JPY-weakness may be in store

The JPY has undergone a distinct adjustment lower versus other major currencies over the past week following the BOJ’s decision to initiate another round of QE and establish an inflation target of +1.0% (latest CPI was -0.3%), suggesting more QE will be needed in the future. Together with Japan’s trade surplus evaporating into a deficit (January trade data due out on Monday morning in Tokyo; adjusted trade deficit of –JPY 850 bio expected), we think there is scope for further JPY weakness in the weeks ahead. Anecdotal reports also suggest Japanese investors started to actively reduce their portfolio hedges, leading them to buy foreign FX and sell JPY, adding yet another flow to JPY-selling pressure.

USD/JPY and many of the JPY-crosses have reached 3-month highs and are testing key resistance levels, such as USD/JPY 79.50/80.00 and EUR/JPY 104.50/105.00. While we think there is further upside in store, we would avoid getting long at these levels and prefer to wait for a pullback to pursue long entries (selling JPY), ideally around 78.00/50 in USD/JPY and 102.70/103.20 in EUR/JPY. Breaks above the resistance zones mentioned above may see JPY-pairs move directly higher in this adjustment. Potential turmoil emanating from Europe next week could provide the desired pullback, if investors turn back to the JPY and the USD on safe haven demand.

Light US data may see risk rally stall

Next week sees the US President’s Day holiday on Monday where US stock and futures markets will be closed. The rest of the week sees relatively minor US economic data (existing/new home sales; weekly jobless claims) only late in the week. We note this because the risk rally currently underway has been extremely tentative and seems to require frequent injections of better-than-expected news and data to keep going. More positive US data reports of late have been a primary source of that optimism, but with minimal data out of the US next week, that medicine may be in short supply. Together with potential disappointment or outright disarray out of Europe, we would not be surprised to see a more negative correction to risk assets and a further bounce for the USD. "


t

All this is just shit delayed....another round of hopium(hope + opium).

however, it helped me....it helped propelled my eur/cad long and eur/gbp long trade....made some nice coin in them too....with those two, i am already over 51% return for the month by just risking 1% per trade.

Anyways, this is the round of hopium shit being spewed:

http://www.ekathimerini.com/4dcgi/_w_art...012_429017
Prime Minister Lucas Papademos hailed as “historic” an agreement struck after 13 hours of talks in Brussels that will lead to Greece receiving a further 130 billion euros of loans and its bondholders accepting a 53.5 percent haircut.

Speaking on Tuesday morning after the marathon negotiations over the details of the new deal, Papademos expressed hope that the new bailout would restore some stability.

“We now have the ability to progress with stability, to limit uncertainty and to increase trust in the Greek economy in order to create better conditions,” he said.

“The new program has elements that will help improve competitiveness and create condition to support steady growth.”

Under the agreement struck in Brussels, Greece will receive 130 billion euros in loans, bondholders will accept a haircut of 53.5 percent rather than 50 and the European Central Bank will pass on any profits from the Greek bonds it holds to national eurozone central banks.

In return for receiving the money from the ECB, eurozone members agreed to lower the interest rate on Greek loans and to pass on any profit from these bonds to Greece.

This would reduce Greek debt by an estimated 3.2 billion euros, bringing Greek debt down to a projected 120.5 percent of GDP by 2020, close to the eurozone’s target of 120 percent, which it deemed to be sustainable.

In return for receiving the new loans, Greece will accept closer monitoring from its lenders. However, the Eurogroup agreement suggests that the oversight will take place through the European Union Task Force for Greece, which is an agency of the European Commission.

“The Eurogroup also welcomes the stronger on site-monitoring capacity by the Commission to work in close and continuous cooperation with the Greek government in order to assist the Troika in assessing the conformity of measures that will be taken by the Greek government, thereby ensuring the timely and full implementation of the program,” the text of the agreement said.

Also, Athens will have to create an escrow account into which money to service its debt will be paid.

“The Eurogroup also welcomes Greece's intention to put in place a mechanism that allows better tracing and monitoring of the official borrowing and internally-generated funds destined to service Greece's debt by, under monitoring of the troika, paying an amount corresponding to the coming quarter's debt service directly to a segregated account of Greece's paying agent,” the agreement said.

Greece will also have to introduce a legal provision, later to be made part of the Constitution, that will give priority to debt servicing rather than domestic expenditure.
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#97

Trading the Financial Markets

Quote: (02-15-2012 01:16 PM)Entropy Wrote:  

Quote: (02-09-2012 02:46 AM)julio26 Wrote:  

usd yen watch for reverse head and shoulders forming break of 77.30 sees 78.20

Nicely done, good lad. Nicely done. It broke 77.30 the day after you made that call...and yesterday it broke through 78.20 JUST AS YOU PREDICTED. Nice work.

charts attached:

ANOTHER UPDATE:
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#98

Trading the Financial Markets

MONTHLY REVIEW: February trading performance

1st week: 9.3%
2nd week: 12.64%
3rd week: 19.12%
4th week: 9.08% (closed out yesterday)

Total net = 50.14% return... risking 1% per each position. I am not in the mood to post a detailed analysis of lessons learned from these trades....check this thread to see all these trades.

I know that it is just 22nd of February....i think i am probably done for the month...i am saying "probably done" because if i see an irresistible setup, i wont lie: i will totally take it. But otherwise,....i want to relax and take it easy...

......waiting for the month of March......

To commemorate this....i present:

[Image: tumblr_lyb7kfUzOk1r7ww1wo1_500.jpg]

in addition....

[Image: tumblr_ltxo9uzTfd1r52yk1o1_500.jpg]

And of course, music:



Reply
#99

Trading the Financial Markets

OH YES, just a little public announcement:

i have the name of the thread changed from "substation:forex and stuff" to "Trading the Financial Markets".... because i want to later include how i trade stocks, options, futures and bonds on this thread too. Not just forex all the time....

*** still smiling ear to ear on the 50.14% return for this month.***
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Trading the Financial Markets

Quote: (02-22-2012 09:27 AM)Entropy Wrote:  

OH YES, just a little public announcement:

i have the name of the thread changed from "substation:forex and stuff" to "Trading the Financial Markets".... because i want to later include how i trade stocks, options, futures and bonds on this thread too. Not just forex all the time....

*** still smiling ear to ear on the 50.14% return for this month.***

Entropy,

What do you think of French banks stocks? You know with the crisis they have been the most damaged last year (due to their Greek exposure)so I bought a few and doing very good so far (+30%). I feel there is an oportunity to increase my exposure but just wanted to check with the guru of Technical analysis [Image: idea.gif]

Thanks !
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