Shorting the close!
short NQ 1071.50, stop 1074.50, target 1050
short NQ 1071.50, stop 1074.50, target 1050
ES Journal Archive (2006 - 2008)
- Thread starter Buy1Sell2
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exit 99.
Sick trade startraitor!
I had a personal-best day for myself and only traded after 1pm haha... I haven't traded RTH since June, this volatility is awesome!
osu-michigan party starts now, good weekend all.
man, took enough to catch it, more than half luck today.
Nice trade!
LC,
I wonder... do you agree with this guy?
http://blogs.wsj.com/marketbeat/2008/11/21/zen-and-the-art-of-the-dollar-and-yen/
November 21, 2008, 2:08 pm
Zen and the Art of the Dollar and Yen
Posted by David Gaffen
The long cycle of deleveraging and forced selling has created a symbiotic relationship between stocks, and the dollar and yen. The relationship has been tight â as stocks weaken, the dollar and yen strengthen against other major currencies.
At times, this relationship has proven so strong that it can be witnessed on an hour-by-hour basis, where sudden equity rallies result in pullbacks in the yen and dollar. As investors are always looking for a signal that the selling pressure in equities will soon abate, theyâre looking more frequently at the action in currency markets.
âA break of the uptrends in these two currencies will be a good indicator of the forced selling starting to subside,â says Prieur du Plessis, chairman of South Africa-based fund management firm Plexus. âOnce this situation has played itself out, we should see a return to lower volatility levels and a return of confidence.â
Since the beginning of October, the Standard & Poorâs 500-stock index has declined by 35% while the dollar has risen 20% against the U.K. pound and 12.4% against the euro. The yen has also been a beneficiary, rising 21% against the euro and 26% against the pound.
But the tendencies that caused this trend may diminish, and yet the rally in the dollar and yen could continue. While forced selling and unwinding of carry-type trades may have sparked the rally, there are additional pressures, such as the flight-to-safety afforded in the largest, most liquid currencies, and the speculative fervor of those piggy-backing on this trend.
âThe flows in the yen and dollar remain a manifestation of what is going on in stocks,â says Ashraf Laidi, chief currency strategist at CMC Markets. âPeople are cognizant of this correlation between risk appetite and currencies, and they open new positions in the yen and the dollar, and they further drive these moves in the currencies.â
Over the past several weeks speculators have been increasing their short exposure to the weakening pound and euro, according to data from the Commodity Futures Trading Commission. When speculators reach extreme levels, it is often a sign that the trend is going to be interrupted. The market has not reached that point with the dollar and yen, but when it does, more than a few trying to take advantage of the path of flows will be caught going the wrong way.
2 very different answers at the same time.
First one is the technical one, based on the price level of the currencies only, then the decoupling will happen pretty soon as something like USD/JPY in theory cannot go to 1 dollar to 1 yen. The problem is that such "in principle" thinking cannot give us any clue where or when the decoupling may happen.
Second one is the fundamental one, which I think the guy got it wrong. Money is a means for the exchange of resources. Real resources I may add. But, the current money system created virtual wealth (or multiplying effect
) through the recycling of money.
The old money (those who has real hard assets) in Europe are actually buying US based assets (including stocks) as the mkt dives. That's why GBP and EUR are under pressure, as no real money exchanged hand, just a very small percent of the hard assets are used as collateral.
I mentioned early last year that old money from Europe is moving out of the US stock market and that will lead to further collapse of the stock market no matter how hard we bounce or even making a new high.
They are back buying the US equities slowly thus the down trend in GBP and EUR. The CFTC report is just on those speculators riding their coattail.
Thus we can tell if decoupling happens in the near future, we are getting the true bottom of the US equities
Think of wave's posts, add the concept of SS's strong hands, and then realize that these old monies are 100 times even more powerful, you can then get the picture.
Here is an example.
10 mil account. 100 mil hard asset. What to do?
1. 10 mil margin long USD 50 mil.
2. Take that 50 mil long US equities, bonds and index products. Just dividend, interest, carry interest, and selling covered calls (on bonds only) alone pay for the holding of the position at 20% plus return a year. Any appreciation on the instruments are bonus. *** risk management the number one priority on all old monies ***
3. For those extra careful clients, a swap is created on the net position in case something goes wrong. That may reduces the return by 1 to 2%.
All I Banks do that for their "super clients". I wonder if they have new tricks now?
First one is the technical one, based on the price level of the currencies only, then the decoupling will happen pretty soon as something like USD/JPY in theory cannot go to 1 dollar to 1 yen. The problem is that such "in principle" thinking cannot give us any clue where or when the decoupling may happen.
Second one is the fundamental one, which I think the guy got it wrong. Money is a means for the exchange of resources. Real resources I may add. But, the current money system created virtual wealth (or multiplying effect
) through the recycling of money. The old money (those who has real hard assets) in Europe are actually buying US based assets (including stocks) as the mkt dives. That's why GBP and EUR are under pressure, as no real money exchanged hand, just a very small percent of the hard assets are used as collateral.
I mentioned early last year that old money from Europe is moving out of the US stock market and that will lead to further collapse of the stock market no matter how hard we bounce or even making a new high.
They are back buying the US equities slowly thus the down trend in GBP and EUR. The CFTC report is just on those speculators riding their coattail.
Thus we can tell if decoupling happens in the near future, we are getting the true bottom of the US equities
Think of wave's posts, add the concept of SS's strong hands, and then realize that these old monies are 100 times even more powerful, you can then get the picture.
Here is an example.
10 mil account. 100 mil hard asset. What to do?
1. 10 mil margin long USD 50 mil.
2. Take that 50 mil long US equities, bonds and index products. Just dividend, interest, carry interest, and selling covered calls (on bonds only) alone pay for the holding of the position at 20% plus return a year. Any appreciation on the instruments are bonus. *** risk management the number one priority on all old monies ***
3. For those extra careful clients, a swap is created on the net position in case something goes wrong. That may reduces the return by 1 to 2%.
All I Banks do that for their "super clients". I wonder if they have new tricks now?
Was that close enough for you Ammo ?
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