The Yen and Paulson
Today Treasury Secretary Paulson came out and said that he was watching the Yen “Very Closely”. This scared the markets (and all carry trades) and sent the Yen up against most major currency pairs. I think that the direction of the Yen is of critical importance. A great deal of the carry trades hinge on a weakening (or Steady) Yen. If the markets (i.e. Fed, ECB etc)deciede that it is not in their best interest’s then the Yen will strengthen (Intervention??)and carry trades will be carried out the door. For now I think we are still in a wait and see situation. Currently it is the European community that is most upset with the strong Yen. Yesterday the German Finance mininster was saying that Eur/Jpy would be discussed at the G7.
I do not see intervention as an option, I could see “jaw boning” in an attempt to get the Yen stronger, but then again I do not see it doing alot. A look at today’s comments from the Fed makes it clear to me that for the forseeable future (as long as the numbers do not deviate much from current level’s) rates are on hold. Yes, they did maintain their tightening bias, but that is to be expected based on the recent numbers. I have actually reentered the waters. I put on some Forward/Forward Mexican rates positions (positive carry), Sold 12 month Usd/Ars at 3.1725 and went short some Usd/Brl at 2.1330 (March BMF).I am still short some Brazilian Forwards.
I am convinced,after reading a comment from a reader, that I have been looking at the markets from to short of a time perspective. So I will attempt to change that (a little P and less L would help my staying power).
THese are the FX Trading Position’s for today.
Good Luck and Good Forex Trading
FXTRADINGIDEAS@AOL.COM
Fed Meeting today
There is a large amount of Economic data today. The key ones to watch for me are:
GDP Expected 3.0% (Bloomberg)
GDP Price Index Expected 1.5% (Bloomberg)
Chicago Purchasing Manager Expected 52.0 (Bloombrg)
and last but not least the Fed Rate Announcement. Now 99% of the market are looking for unchanged on the actual rate but the improtant thing to watch is the statement. Are the Governors leaning any particular way….
I am expecting little changed from their last meeting. I still think that rates are on hold for the next 6mths, but of course the numbers are the key factor going forward.
In the current environment I do not think there are any “home runs” in play at the moment. But there are always opportunities brewing. If you see any please let me know.
These are the FX Trading comments for today.
Good Luck and Good Forex Trading.
FXTRADINGIDEAS@AOL.COM
Emerging market currencies continue to suffer against the Dollar as Mexico touched 11.1000 before backing off on early trading. This is the top end of a channel which has been forming for the past 7mths. I am not a real fan of Technicals but other dealers are clearly looking at this so be careful if we break the top side as it could really run. Please see Bloomberg chart above. I am also sitting short Euro/Usd and will stop out at 1.3048 and am looking to take profit at 1.2686. I entered the position at 1.2912
These are the FX Trading Ideas for today
Good Luck and God Forex Trading.
FXTRADINGIDEAS@AOL.COM
Emerging market currencies continue to suffer against the Dollar as Mexico touched 11.1000 before backing off on early trading. This is the top end of a channel which has been forming for the past 7mths. I am not a real fan of Technicals but other dealers are clearly looking at this so be careful if we break the top side as it could really run. Please see Bloomberg chart above. I am also sitting short Euro/Usd and will stop out at 1.3048 and am looking to take profit at 1.2686. I entered the position at 1.2912
These are the FX Trading Ideas for today
Good Luck and God Forex Trading.
FXTRADINGIDEAS@AOL.COM
Every Dog has it’s day
To say that the market this year has been unkind to me is an understatement. Every (I repeat Every….well maybe most..)trade I have taken since June 2 has gone poorly. Some are my fault, others are just being in the wrong place at the wrong time. But as I have stated previously, I believe that you always make your own luck. Hard work will pay off. After further reflection I do not think I have been working as hard as I could, or should be. I one time years ago read a quote by Arnold Swarznager (and I am paraphrasing here) “Whenever I found that I was not achieving my goals I went back and worked harder”. No excuses, point the blame where it belongs and move on.
I have also been working on a trading model. It is still in it’s testing stage but I will be posting a the signals as they come up. They will not be in real time (as i do work for a living) so by the time you see the signals some will be in the money and other out of the money. Do not take these signals as trade recomendations. It is just something that I am working on.
These are the FX Trading Ideas for today.
Good Luck and Good Forex trading
FXTRADINGIDEAS@AOL.COM
-
*************************
