The media BIAS is so obvious that it's RADIO ACTIVE!!!!
Saturday, October 31, 2009
EEV
Moving stop on EEV to 13.60 this locks in very nice profit... The pattern looks bullish, so price could test 14.63 as the volume on Friday was huge... If price closes the gap then we could see 15.60...Hope it helps
Friday, October 30, 2009
EUR/CHF
Hit first target @ 1.5135 since this took place while I was asleep I'm moving my stop to my entry of 1.5114 risk free trade... Hope it helps
Thursday, October 29, 2009
EEV
Long on EEV @ 12.77, stop @ 12.38, target 1 @ 13.29 target 2 @ 14.08... This is a low risk trade...hope it helps
GBP/USD
2nd target hit @ 1.6551 moving stop to 1.6544 locking in +130 ticks... VERY NICE
Next target 1.6735... hope it helps
Wednesday, October 28, 2009
EUR/USD Struggle
EUR/USD
The Euro edged back above 1.49 against the dollar in early Europe on Tuesday, but was unable to regain any momentum and was subjected to renewed selling pressure during the day.
Annual Euro-zone money supply growth slowed to 1.8% in September from 2.6% previously while there was a 0.3% contraction in bank lending. The persistent slowdown in monetary growth over the past few months will increase fears over a credit crunch within the banking sector and will maintain pressure for a loose ECB monetary policy to be maintained and this will tend to limit Euro support.
The US housing data was slightly stronger than expected with a fourth successive monthly increase which cut the annual decline in prices to 11.3%.
In contrast, the consumer confidence data was significantly weaker than expected with a decline to 47.7 for October from a revised 53.4 the previous month. There was a deterioration in confidence surrounding current conditions and expectations with the current index at a record low as confidence in the labour market deteriorated. This development is slightly surprising given that the weekly jobless claims data has generally improved and certainly suggests that hiring patterns are particularly weak and will raise concerns over the economic outlook. The Richmond Fed index edged slightly lower for October, but remained in positive territory.
The decline in confidence undermined risk appetite and there was renewed defensive demand for the dollar even though the Dow Jones index was resilient. The Euro dipped to a low around 1.4770 before consolidating near 1.48.
Tuesday, October 27, 2009
The U.S. Dollar is DRIVEN by 3 factors
When it comes to the decision of whether you should buy or sell dollars, it all boils down to how the economy is performing. A strong economy will attract investment from all over the world due to the perceived safety and the ability to achieve an acceptable rate of return on investment. Investors always seek out the highest yield that is predictable or "safe." Investment from abroad creates a strong capital account and a resulting high demand for dollars.
On the other hand, American consumption that results in the importing of goods and services from other countries causes dollars to flow out of the country. If our imports are greater than our exports, we will have a deficit in our current account. With a strong economy, a country can attract foreign capital to offset the tradedeficit. The U.S. can continue as the consumption engine that fuels all the world economies even though it's a debtor nation that borrows this money to consume. This also allows other countries to export to the U.S. and thus keep their economies growing. This explanation is simplistic, but it illustrates a point.
Factors Affecting Dollar Value
The point is that when it comes to taking a position in the dollar, the currency trader needs to assess the different factors that affect the value of the dollar to try to determine a direction or trend. The methodology can be divided into three groups as follows:
Supply and demand factors
Sentiment and market psychology
Technical factors
Let's take each group individually.
Supply Versus Demand for Dollars
When we export products or services, we create a demand for dollars because our customers need to pay for our goods and services in dollars and, therefore they will have to convert their local currency into dollars. Hence they sell their currency to buy dollars so that they can make the payment.
In addition, when the U.S. government or large American corporations issue bonds to raise capital, and if these bonds are bought by foreigners then again the bonds have to be paid for in dollars and the customer will have to sell their local currency to buy dollars so they can effect payment. Also, if there is strong growth in the U.S. and companies are expanding their earnings then the desire by foreigners to own corporatestocks in the U.S. also requires that they sell their currency to buy dollars to pay for the purchase of stocks.
Market Psychology and Sentiment
But what if the U.S. economy weakens and consumption slows due to increasing unemployment? Then the U.S. is confronted with the possibility that foreigners may sell their bonds or stocks and return the cash from the sale in order to return to their local currency. Hence they sell the dollars and buy back their local currency.
Technical Factors
As traders, we have to gauge whether the supply of dollars will be greater or less than the demand for dollars. To help us determine this, we need to pay attention to various news and event items, such as the release by the government of various statistics, such as payroll data, GDP data, and other market and economy measuring information that can help us to determine what is happening in the economy and to estimate whether the economy is strengthening or weakening.
In addition, we need to determine the general sentiment regarding what the players in the market think the outcome of events is likely to be. Very often, sentiment will drive the market rather than the fundamentals of supply and demand. To add to this mix of prognostication, besides the measurement of supply and demand factors and sentiment, we also have the historical patterns generated by seasonal factors, support and resistance levels, technical indicators and so on. Many traders believe that these patterns are repetitive and therefore can be used to predict future movements.
Bringing Them All Together
Since trading relies on the ability of a trader to take a risk and manage it accordingly, traders usually adopt some combination of the three above methods to make their buy or sell decisions. The art of trading exists in stacking the odds in your favor and building an edge. If the probability of being correct is high enough the trader will enter the market and manage his hypothesis accordingly. To stack the odds in our favor we therefore need to take into account each one of the three methodologies and hopefully find them to be congruent, meaning that they all point in the same direction.
An Example
The economic conditions during the recession that began in 2007 forced the U.S. government to play an unprecedented role in the economy. Since economic growth was receding as a result of the large deleveraging of financial assets taking place, the government had to take up the slack by increasing government spending to keep the economy going. The purpose of their spending was to create jobs so that the consumer could earn money and increase consumption thereby fueling the growth needed to support economic growth.
The government took this position at the expense of an increasing deficit and national debt. It financed this increase by essentially printing money and by selling government bonds to foreign governments and investors - resulting in an increase in the supply of dollars. Hence the dollar depreciated as a result. Another concern for countries that rapidly issue debt is that the interest burden will increase and, therefore, more tax dollars will be allocated just to cover the interest rate.
One of the roles of the government is to create the conditions necessary to allow the markets to grow so that is the economy is as close to full employment as possible, but with controlled inflation. Thus when the economy deflates the government will try to do all it can to re-inflate it in a controlled manner.
The Bottom Line
It may be helpful for a trader to keep an eye on the Dollar Index chart to provide an overview of how the dollar fares against the other currencies in the index. By watching the patterns on the chart and listening to the sentiment in the market, as well as monitoring the major fundamental factors that affect supply and demand, a trader can develop a big picture sense of the flow of dollars and thus develop an insight to choose profitable positions in future trades.
Monday, October 26, 2009
Charts not working
Well, I missed some nice setups this morning due to the charts not working... bonds, pound and indexes... Waiting patiently
Sunday, October 25, 2009
Niall Ferguson: U.S. Empire in Decline, on Collision Course with China
This video is worth a watch...
"People have predicted the end of America in the past and been wrong," Ferguson concedes. "But let's face it: If you're trying to borrow $9 trillion to save your financial system...and already half your public debt held by foreigners, it's not really the conduct of rising empires, is it?"
http://finance.yahoo.com/tech-ticker/article/357319/Niall-Ferguson:-U.S.-Empire-in-Decline,-on-Collision-Course-with-China Technicals
I found this old chart of the Eminis Futures fromSeptember... I drew the fibo on the chart September 17th...I'm posting this for those that don't believe in technicals... Notice how many times the price action hits the top of the fibo after September 17th... AMAZING!!!
Saturday, October 24, 2009
AMERICAS Transition...
I see a trend and vision of this country that cannot be seen from a trader’s window. I fear that America will soon be a country characterized by a populace of the permanently unemployed. Every day, the disconnect between Wall Street, Washington and Main Street deepens. While the stock market continues to rise towards alternate realities and Hollywood D.C. remains comfortably insulated with out of control government spending, Main Street Americans are suffering under the weight of job losses, home foreclosures and hopelessness. Rising unemployment numbers and the duration and permanence of that joblessness are ignored as irrelevant. And, moreover, the numbers being released by Hollywood D.C. do not represent fairly the depth and breadth of America’s jobless reality. In truth, today, one out of every 5 Americans is unemployed or underemployed. In September, the Bureau of Labor Statistics (BLS) reported that, since the start of the recession, unemployed persons in America had increased by 7.6 million to 15.1 million, and that the unemployment rate had doubled to 9.8%. But if we turn to the household survey that seeks to determine whether or not people are working by asking individuals their job status, rather than querying the companies that employ them, the September job loss figure is not 263,000 but instead closer to 785,000. Adding insult to injury, household net worth has declined by 14 trillion dollars since the onset of the recession and household financial distress is further exacerbated by diminishing employment opportunites. And the cycle of destruction continues. Underemployment, U-6, which includes both part-time workers who lust for full time employment and discouraged workers, “the marginally unattached,” reached staggering new heights at 17.8%. Alan Abelson quantified well the situation in an October 5, Barrons column: if we add 9.2 million of involuntary part time workers to the 2.2 million of the marginally unattached and the 15.1 million of reported unemployed, the equation sums to 26 million Americans out of work. Until job loss turns to job creation, we have little chance for a true economic recovery. Absent job creation, little else matters. Consumers cannot spend, businesses will not invest and government budgets cannot balance, 39 states are running a deficit. I believe employment is the leading indicator of our economy, and I take umbrage to the blind claim of laggard. Jobs are not created by big businesses that house under 20% of America’s labor force, but rather by SMEs – small and mid-sized companies. These companies, the backbone of the American economy, have lost access to the traditional working capital loans upon which they depend to manage their businesses. As a consequence of the sudden dearth of capital available in this market, companies that might otherwise rationalize and survive the current economic downturn are laying off workers — layoffs that will result in permanent job losses as, without access to capital, these companies have no choice but to liquidate. This phenomenon is driving not only permanent job losses, but also the eclipse of technology and the destruction of transferable industrial knowledge and product creativity.
Friday, October 23, 2009
AUD/CAD
Hit first target while asleep, now moving my stop to .9714 making this a risk free trade with a nice little profit locked in... Hope it helps
STOPPED OUT +8 TICKS
Thursday, October 22, 2009
AUD/CAD
Long @ .9706 1st target .9749 stop .9630... i WILL MANAGE THIS TRADE AS IT UNFOLDS...Hope it helps
FRUSTRATED!!!!
I've made 2 trades today and got only 1 point each, even though profitable I'm not a happy camper!!! I do have to remember that I did follow my methodology...Anyone ready to give me a brownie button?
ES Long
Moving my stop to lock in 1 point @ 1077.50 which makes this a risk free trade... Risk management is always NUMBER ONE!!!
Wednesday, October 21, 2009
LURKING!!!!
I’m lurking in the weeds as I wait for the Euro to break through the 150 wall. This is a critical resistance for the Euro. As the Euro goes, so too go the equity markets. These two puppies have been running together lately as the dollar wanders off to become the new carry trade. If the Euro doesn’t bust through, then gold and the equity markets should relax and create another super-rich trade setup.
My mom could squeeze the eyeballs out of buffalo’s head on a nickel; I love buying at a DISCOUNT. She taught me well. Hope it helps!
Canadian Dollar
Long @ .9531 1st target @ .9589 stop @ .9543...This is a wakeup play, sometimes I call it the chocolate box of candy play, you never know what you're going to get until you wakeup...
Tuesday, October 20, 2009
Canadian Dollar
I placed a limit order for the Canadian Dollar @ .9530... I'm going to bed, hopefully I'll wake up to a nice trade... Hope it helps
30 Year Treasury
Stopped out @ 120'16 plus 10 ticks... not what I was looking for still a nice profit... Got within 2 ticks of my first target @ 121'04... have to stick to your plan...
Monday, October 19, 2009
INFLATION/DEFLATION Battle....
As the markets continue to move higher in the midst of the "INFLATION/DEFLATION" battle the tug of war continues. It's very clear, to me at least, that technically the dollar should be the primary catalyst with which to launch which way the market will go. As a technical pattern recognition/trader, I am preparing my strategy for whichever way that it might break! How much money can the corruptocrats print? How many countries will adjust their treasury backed currency from $USD to another currency: the Euro, the Yuan or the Yen? Which countries will switch their oil currency from $USD to other currencies, such as the Euro, the Yuan or the Yen? Could the $USD become the new Currency Carry Trade? For those of you that aren't familiar with the terminolgy, please see the following example of a "yen carry trade":
A trader borrows 1,000 Japanese yen from a Japanese bank, and converts the funds into U.S. dollars, and then buys a bond for the equivalent amount. Let's assume that the bond pays 4.5% and the Japanese interest rate is set at 0%. The trader stands to make a profit of 4.5% as long as the exchange rate between the countries does not change. Many professional traders use this particular type of trade because the gains can become very large when leverage is taken into consideration. If the trader in our example uses a common leverage factor of 10:1, then she can stand to make a profit of 45%.
The big risk in a carry trade, so called, is the uncertainty of exchange rates. Using the example above, if the U.S. dollar were to fall in value relative to the Japanese yen, then the trader would run the risk of losing money. Also, these transactions are generally done with a lot of leverage, so a small movement in exchange rates can result in huge losses unless the position is appropriately hedged and otherwise safeguarded.
Sunday, October 18, 2009
British Pound
The british pound is definitely worth a look to enter a short position... I'm waiting for confirmation, I hope it happens before I go night night...
GOLD
I'm sure that many of you are talking about gold... Should I buy here should I wait - what do I do? All I can say is, if you don't already have a position in gold, be patient and you should be able to buy at a discount in the next few days... I will add to my position on the next pullback...
Friday, October 16, 2009
Thursday, October 15, 2009
Spy in the Sky
Another interesting setup on the spy when this rolls over it will hurt like an impacted root canal...
I wish I had a pogo stick so I could jump up and down for the joy this trade should deliver....
SPX
I have talked about this chart a few times...As we get closer and closer to to the 50% Fibonacci, notice how the price action is approaching 1122 and at the same time the MACD & Stochastics are in the overbought zone.... I normally don't use indicators, but i thought this was an interesting setup to share.... Stay tuned
Wheat Futures
I moved my stop to 509.50 and got stopped out with a 3.25 profit... Not what I was l looking for but
I followed my plan... hope it helps
I followed my plan... hope it helps
Wednesday, October 14, 2009
My favorite tune....
I've been writing for a while now about how I'm licking my chops as we approach 1120 on the S&P and 10,400 to 10,600 on the DOW. This is a technical setup that should create a great trade opportunity which, in turn, will play a tune that we all LOVE to hear - KA-CHING! I am chomping at the bit while I wait patiently for things to gel and go forward! My gold strategy(see 9-13) continues to impersonate an ATM machine, which is terrific.
Tuesday, October 13, 2009
ATM MACHINE
My Gold Strategy I wrote on September 13th has been like an ATM machine with a dump truck backed up to it... Hope all of you are feeling the same love (ching! ching!)... I do this in hopes of other people benefiting from what I share with technical analysis and pattern recognition...
FHA - Look closely and tell me what you see...
Look at this ad on the FHA website - with no credit check!!!! FHA is using the same loan ratios that Fannie Mae & Freddie Mac used and we all know what happen! When will America WAKE UP? Polls are showing Americans think the worse is over. Hmmmm.........
Monday, October 12, 2009
Shorting Oil Futures
I'm placing a limit order to short oil @ 74.00 with a target of 69.50 and 76.00 stop... For those of you that don't trade the futures, you may want to look @ USO... Hope it helps
Gold's next stop
Some of you have asked - how high can gold go? Well, it should test 1070.00 and somewhere between now and then, there should be a pullback which is very healthy following a parabolic move like we've just witnessed... When and if it breaks through 1070 - should go to 1100.00 fairly quick...
LONG ES
I got long the ES today @ 1074.00 with a target of 1084.50... This is a swing trade, stop @ 1066 ...
$USD - UUP
I entered a long trade on UUP @ 22.64 Friday with a target of 23.o9, I am looking for the dollar to test 77.50 @ the bottom of the down trend line...See chart of USD...
Sunday, October 11, 2009
INFLATION VS DEFLATION???
Can the government print enough $$$$ to offset the deleveraging that is taking place in the the residential and commercial real estate markets? I don’t think they can… This chart will tell us which way to go in the near future... Here’s a daily chart of the ten year treasury, a break above the horizontal line means deflation here we come and a break below the trend line spells inflation...If you read and mirrored my gold strategy then I would hope that you would pay attention to how this chartaholic does chart analysis - when it comes to technical pattern recognition!!! Was my GOLD STRATEGY luck or just good old pattern recognition? Stay tuned as the the $USD tries to rally and the S&P makes an attempt @ kissing 1120.00... Worse case scenario inflation is at least manageable with serious implications and deflation is a DISASTER! Regardless of all the above - great trading opportunities will surface...
Saturday, October 10, 2009
Psycological Depends
Unfortunately - Having a financial adviser enables the investor to wear psychological depends(diapers) . If an investment strategy turns out well, the investor can take the credit, attributing the favorable outcome to his or her own skill. If the strategy turns out badly, the investor can protect his or her ego and lower the regret by blaming the adviser. This phenomenon involves self-attribution bias. The investor attributes favorable outcomes to skill, and unfavorable outcomes to either somebody else, or just plain bad luck.As a former fashion designer this applies to buyers as well... Actually OUR CULTURE!!!
Friday, October 9, 2009
SOY - LONG
I learned a good lesson today I left a TON on the table!!! Don't get me wrong, I'm not complaining about a 10 point gain, I should have managed the trade instead I was looking for another setup... I should have had my timer on for the open as I normally do... Another good lesson!!!! Constantly learning...
Thursday, October 8, 2009
Currency Scoop
EUR/USD The dollar found support weaker than 1.4730 against the Euro on Wednesday and the ability to resist fresh lows prompted some limited covering of short dollar positions even though underlying confidence remained weak. Energy prices were lower which also eased immediate selling pressure on the USD...
Another October Market Swoon?
Whether you call it a bear market rally or a new bull market, the rally in the stock market since March seems to have run into an obstacle now that October has arrived. Everyone knows about October's reputation in the stock market so it may be no surprise to many that the advance since March...
Corn - Long
Got long corn last night while I was asleep @361.50 with a target of 369.50 moving my stop to lock in some profits...
Wednesday, October 7, 2009
STOPPED OUT - DAAAAA!!!!!
I got slapped around today as a reminder to follow my own rules... I entered this trade and got stopped out with a 4 point loss... What did I do wrong? I entered the trade during the low volume period of the trading day... No volume! I've been so successful lately (got cocky) that I went against my own rules...
AUD
My AUD long is performing beautifully, moving my stop to lock in FAT profit... See 10-5 posting on AUD... Entered @88.08 new stop @ 89.59..
British Pound - Sniper trade
Here's a sniper trade that I made this morning... Chipped off 30 ticks for a quickie...
Tuesday, October 6, 2009
GOLD weekly chart
Charts never seize to amaze me - each candle represents 7 days... I drew the technical line and the price level on 8-31... Look at how many times the price action has touched support in this case price level... AMAZING!!! hope it helps...
UNG Rejection or Breakout???
How many times can UNG be rejected? I'm watching this very closely to see which way it will decide to journey...
FUTURES GOLD SOLD...
Gold hit my first target today @ 1044 next target @ 1065, sold half my position and moving my stop to lock in profits...
Monday, October 5, 2009
$USD
Notice how the breakout bar to the downside has never been taken back to the upside... I shorted the dollar last night and I'm still in the trade... My stop is @ 77.05 - Hope it helps...
Gulf in talks on replacing U.S.$ for oil: report
I have been talking about this for months and finally the press will get this to the public...
GOLD GOLD GOLD!!!
Looks like gold has heard my rally cry to go higher!!! visit my blog and you can hear it as well... see Oct 3rd posting...
Sunday, October 4, 2009
Saturday, October 3, 2009
Friday, October 2, 2009
THE GOLD HOLD
Technical analysis and pattern recognition never cease to AMAZE me! The fact that we are looking at buyer behavior based off GREED and FEAR... I posted a gold chart on 9-26 and just look at how often the price hits the price level support line...
Stocks, US dollar, crude oil slide on weak U.S. jobs data.
Markets rushed to buy the dollar as a safe haven as the jobs data was released...The dollar closed below prior resistance of $77.33 (see previous chart posted 9-25)... Oil once again retraced to the bottom of the channel(see chart posted 9-27) and here's today's oil chart...Stocks were weak in general, had it not been for analyst upgrades of apple and some other tech stocks got a boost from UBS and Morgan Stanley...Gold continues to hold at the $1000 support level as I continue to add to my gold position... Market jitters continue to intensify as the recovery shows more negative data... Underemployed approaches 17% as the nations jobless rate jumped to 9.8%... If you believe that I have a bridge for sale in Arizona...
SRS
SRS hit my target @11.09 for 118% profit... This trade was a test of my patience, took much longer than I anticipated...
Thursday, October 1, 2009
TOMORROW
TOMORROW WILL BE INTERESTING... WILL THE JOBS REPORT BE THE CATALYST TO PUSH THE DOLLAR THROUGH RESISTANCE? WILL GOLD BOUNCE OFF THE 1000 LEVEL? WILL BONDS CONTINUE THEIR MARCH TO 124? THE YM IS POISED TO GO LOWER SINCE IT HAS BROKEN OUT THE CONSOLIDATION BOX IT WAS IN... ES LOOKS LIKE IT COULD TEST THE TRENDLINE @ AROUND 1009...I'm just looking for a couple roman candles!!!!EURO LOOKS LIKE ITS READY TO BOUNCE TO THE UPSIDE... OIL IS IN LIMBO TECHNICHALLY...
I'm out...
TWM
This trade is now up 115% and one of my rules is that when a trade is up over 100% intra day, I lock in 100%... Good luck
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