Chinook's EUR/USD (E/$)Mumblings
- Thread starter chinook
- Start date
It would probably take a trade below 1.24 to get me to abandon trading from the long side in the EUR. I say around 1.24 because that is basically the area where we broke out to the upside from our previous major consolidation 1.20-24. I know that 7 big figures seems like a lot, however, it's not to me as I am only concerned with the big trend and long-term outlook. As for short-term positioning, I sold out much of my most recent purchase on stops at 1.3140 and the balance at 1.3120 when it started to move against me. I utilize stops for short-term risk management but will look to re-enter from the long side in EUR on either a major washout or, some show of upside strength. Best, Neal.
The last weeks trading above 1.30 has been all about chopping sideways in my opinion - the korean news tilted the action a little, but it's mostly "valued in" by now. I still see the market as having some range centered around 1.30-ish for a while going forward.
Another interesting thing has been how we now see quite a lot of "resistance/support" in the EuroFX futures trading aroundt the big 00-values, while spot seems to glide quickly through some times.
With all the chasing of barriers, exotics etc. last year - this has probably changed some by now. I thought late last year that fx futures conditions were changing from how I was used to reading the markets when we were locked in the sub 1.26 range.
On the other hand - me starting fx trading during the summer and with markets gridlocked in a tight range probably shielded us from exposure from the bigger, stronger players we could see driving markets during the breakout after the summer.
The increased popularity (neccessity?) of oil prices as part of strategies with big market players perhaps also contributed to this change - with more hedging activities.
I think some range-trading is still ahead because news flow and sentiments seems more contradicting and sober right now, with higher oil prices being absorbed as well as economic realities settling in. Like some said - december is the "sky is falling"-month, and the rocket-ride upwards in the EURUSD seemed to help this notion prevail.
Seeing a weaker USD and talk of central bank policies changing around the world probably will have some fundamental effect on valuation - and it's doubtful we'd go much lower from recent lows - as Neal pointed out.
Barring some USD-sensitive catastrophic event I think we'll see calmer waters.
Another interesting thing has been how we now see quite a lot of "resistance/support" in the EuroFX futures trading aroundt the big 00-values, while spot seems to glide quickly through some times.
With all the chasing of barriers, exotics etc. last year - this has probably changed some by now. I thought late last year that fx futures conditions were changing from how I was used to reading the markets when we were locked in the sub 1.26 range.
On the other hand - me starting fx trading during the summer and with markets gridlocked in a tight range probably shielded us from exposure from the bigger, stronger players we could see driving markets during the breakout after the summer.
The increased popularity (neccessity?) of oil prices as part of strategies with big market players perhaps also contributed to this change - with more hedging activities.
I think some range-trading is still ahead because news flow and sentiments seems more contradicting and sober right now, with higher oil prices being absorbed as well as economic realities settling in. Like some said - december is the "sky is falling"-month, and the rocket-ride upwards in the EURUSD seemed to help this notion prevail.
Seeing a weaker USD and talk of central bank policies changing around the world probably will have some fundamental effect on valuation - and it's doubtful we'd go much lower from recent lows - as Neal pointed out.
Barring some USD-sensitive catastrophic event I think we'll see calmer waters.
If I remember correctly, you exchanged your account funds to USD, in anticipation of a USD (long term) appreciation. Do you still hold this view, or did you exchange your funds back to EUR?
I made some pips from the EUR slide to 3100 today, but the up move will likely continue. Or maybe a further retracement to 3000 is likely?
Any ideas on cable, sub 9000 would be a good target in my view.
Everything is white in the Netherlands, nice good snow
I held on to my view on a large retracement - but did not know from where of course - and it could have hit 1.40-ish befer it stopped and started retracing too. I did switch back to a primarily EUR-based funding again. I can only lament the little gain I had on this, and lost out on the big 900-pip retrace. I do have a chunk in USD too, so I'm a little spread out.
I think we'll see some range-based trading for now. The excitement was all about the new record ground for the EURUSD and all the wailing along with the record oil prices. Now that's familiar ground, and I see no reason for pushing it higher yet.
Some nice chopping is what will upset the markets for a while; making it look like it will break down, then up again - ad nauseum. The underlying trend and fact is still here - we will be getting used to levels over 1.30 - but with the temptation of letting it go lower - chopping markets good. There should be no surprise if we see new highs later on - probably on the back of some big moves rather than a slow steady grind like last fall and winter.
I'm involved in some other business projects too, so I'm not trading as much as before - but trade most days a little. I will need to work out some good long term strategies, but realize that I'm still very fresh in this game.
Scalping seems the easy way for me still; I should probably compare it more to gambling. Keeping profits whenever they appear still is my strategy - and it's pretty fool-proof. I usually get the initial move right, so whipsaws don't get me so easily when I am stubborn about keeping every trade in the black rather than letting it whip me around. No big moves come easy this way, and it is very much bottom-fishing and peak-hiking ...
During RTH it resembles arcade gaming a little - if one would visualize all the action. Holding trades only for seconds sometimes.
Kind of a wet blanket with the NFP giving a complicated numbers package and only a 80-ish pip whipsaw range.
This adds to my conviction that we'll see a continued limited range even in the short term.
I got lucky on a single gambling trade on the numbers, but have zero bias overall.
This adds to my conviction that we'll see a continued limited range even in the short term.
I got lucky on a single gambling trade on the numbers, but have zero bias overall.
I thought it was funny that a rally came out of this - but that just makes it logical. Everyone and their grandmother were short around 1.3230 last time ... so it's only natural that everyone scramble after they see their positions crumble, or jump on the shorting carousel again.
Now, the push back here just makes it more interesting - it still seems to be ranging, but could turn into higher territory again if many get caught short and get stubborn about it.
I still belive we will see 1.30 again for setting the range ahead. I have no long positions, just a balanced EUR and USD funding. After striking lucky on the initial whipsaw I just decided to call it a week.
Been buying some more powertools, because I like to try my carpenter-skills again. I haven't made anything worthwhile in wood since the age of 11, save for one little piece 3 years ago. Now I want to build some toys (swing etc.) for my son ... wood is pretty cheap here (although it's hard as steel), and it's a nice break from typing on the keyboard. I'd better stop if I start doing grunting noises like Tim Allen.
Now, the push back here just makes it more interesting - it still seems to be ranging, but could turn into higher territory again if many get caught short and get stubborn about it.
I still belive we will see 1.30 again for setting the range ahead. I have no long positions, just a balanced EUR and USD funding. After striking lucky on the initial whipsaw I just decided to call it a week.
Been buying some more powertools, because I like to try my carpenter-skills again. I haven't made anything worthwhile in wood since the age of 11, save for one little piece 3 years ago. Now I want to build some toys (swing etc.) for my son ... wood is pretty cheap here (although it's hard as steel), and it's a nice break from typing on the keyboard. I'd better stop if I start doing grunting noises like Tim Allen.