EUR will skyrocket this afternoon

[clambill]

I'll try to shorten your learning curve a bit here. If you want to simplify technical analysis as much as you can, you could put it this way: There are two types of movements: trading ranges and trends. And two types of indicators: trend following (like moving averages) and contrarian (like the slow stochastics, these are also called momentum oscillators).

If you have relatively equal relative lows and relative highs, then you have a trading range. If you have a series of higher relative lows and relative highs, you have an uptrend. If you have a series of lower highs and lower lows, you have a downtrend. A very flat range after a large move (consolidation phase) can be considered a retracement). If you look at steep trends in both directions, you'll notice reracements are usually much smaller than the size of the moves in the direction of the overal trend.

 

[Now is Now]

Quote from iflyjetzzz:

[B.
I retire from work this fall and may spend a bit of time learning technical analysis once I've gotten in a few rounds of golf. [/B]

Where are you located?


NiN

 

[clambill]

I may continue my post on technical analysis later but does anyone know why the volume goes up every time the euro goes down? I know volume in Forex apparently is synthetic volume (and I don't know where it comes from). But, it looks to me on the chart like the governments are trying to support the euro every time it dips. If this is possible, why would this occur? They could export more if the euro goes down.

 

[Cambist]

Quote from iflyjetzzz:

NiN, Cambist, thanks for the words. I'm a refugee from another financial forum - the owner opted to make it a pay site for 16 hrs/day (5A-9P EDT) and my fear that many of the good posters would leave is starting to come true. As a result, I wandered around the 'net and ended up here; the volume of posts is a bit lighter here but there are plenty of intelligent posters on this board which is important to me.

you may also want to try forexfactory forums... I post on the GBP/JPY thread a lot.

 

[davidmaria1]

Quote from clambill:

I may continue my post on technical analysis later but does anyone know why the volume goes up every time the euro goes down? I know volume in Forex apparently is synthetic volume (and I don't know where it comes from). But, it looks to me on the chart like the governments are trying to support the euro every time it dips. If this is possible, why would this occur? They could export more if the euro goes down.

If I'm correct, volume is broker-specific. If governments were visibly supporting their currency, for you to see it, the gov't in question would be using your platform/broker. What are the chances? Unless you swing a bigger stick than you imply?
BTW, I read the Ponsi book, good basic stuff, not to be ignored.

 

[iflyjetzzz]

A quick update on the Greek/German 10 year bond spread. It's now at 425 basis points. Article: http://www.ana.gr/anaweb/user/showplain?maindoc=8624059&service=142
The spread continues to widen indicating that the bond market thinks that the default risk in Greek bonds continues to increase. Greek three year bonds are above 7%. That will mean that Greece will be trying to tap the 5% Eurozone and IMF loans very shortly and stop trying to finance their debt through external offerings. Once this happens, it will be a question of how long individuals in the rest of the Eurozone will stand by while they watch their countries - already in financial difficulties - assisting Greece. And then how long will it be before another of the PIIGS comes and asks for the same deal? Portuguese spreads are starting to widen so they may be asking for 5% loans very soon. Portuguese credit default swaps (essentially bond default insurance) increased last week to their highest levels since February.

Next week, Greece will be selling 1.5 billion Euros of 13 week debt. http://news.xinhuanet.com/english2010/world/2010-04/16/c_13254959.htm
I'll be watching the results of that auction.

Quote from Now is Now:

Where are you located?

NiN

Currently on temporary duty at Ft Meade, MD. My wife is in San Antonio but will be reassigned to Tucson this fall. Our plan is for me to retire and join her in Tucson.

Quote from Cambist:

you may also want to try forexfactory forums... I post on the GBP/JPY thread a lot.

I've had ForexFactory bookmarked for a couple of years now. They're a good source of govt reports. Their forums are Forex-centric though and I'm more of a stock and to a lesser degree commodity investor. I hopped on the EUR short due to the problems that I see in Europe.
This is a good all-around forum with a good mix of subforums (I'd like to see a few more subforums, but that's just my personal preference). And I like to come to a single forum to get most of my financial news/information.

 

[clambill]

I noticed something on Friday. The EUR/CAD and USD/CAD did about the same move, which was to skyrocket on the Goldman Sachs news. Then I noticed they've gone down the last several weeks. Does anybody think it would make any sense at all to short the USD/CAD if you think the euro is going down? This is because I think the spreads on the USD/CAD pair might be more liquid than the EUR/CAD pair (meaning tighter spreads, it's 12 pips for the EUR/CAD with FX Open on a micro lot account).

 

[cstfx]

CAD got weak because of crude. Look at a crude chart for Friday to see the price action against your CAD pairs. Since Goldman is such a huge energy trader it was felt here the most first. Take a look at the EURUSD chart and you'll see it didn't close far from when the news broke. Look at crude on Sunday overnight to see where the Canadian pairs may move.

Also notice they were able to close the gap from Sunday but it took them all week to do it.

 

[Now is Now]

Quote from iflyjetzzz:

A quick update on the Greek/German 10 year bond spread. It's now at 425 basis points. Article: http://www.ana.gr/anaweb/user/showplain?maindoc=8624059&service=142
The spread continues to widen indicating that the bond market thinks that the default risk in Greek bonds continues to increase. Greek three year bonds are above 7%. That will mean that Greece will be trying to tap the 5% Eurozone and IMF loans very shortly and stop trying to finance their debt through external offerings. Once this happens, it will be a question of how long individuals in the rest of the Eurozone will stand by while they watch their countries - already in financial difficulties - assisting Greece. And then how long will it be before another of the PIIGS comes and asks for the same deal? Portuguese spreads are starting to widen so they may be asking for 5% loans very soon. Portuguese credit default swaps (essentially bond default insurance) increased last week to their highest levels since February.

Next week, Greece will be selling 1.5 billion Euros of 13 week debt. http://news.xinhuanet.com/english2010/world/2010-04/16/c_13254959.htm
I'll be watching the results of that auction.

Pilot?

The 40 + billion is nothing more than a band aid on an amputation, basically to see when the blood leads as there is no way Greece has a handle on their worse case scenario...

As suggested before, it is only a matter of time before Greece put their hand out to the IMF. This will give Portugal license to open up and say "me too" and admit they are technically insolvent...they are aware that Merkel and co are not going to bail them out with temporary funding.

The fly in the ointment is going to be Italy...and that will be the last straw for "unity" as we know it. The sh*t has not hit the fan by a long stretch.

Have had a strong short bias in Euro since Dec 7 and see absolutely no reason to expect any change for some time to come..as to when..any body's guess...I don't make predictions, however have been very happy with price action on a daily basis.

The basic fundamentals of the socio-economic European scene is very disturbing, in my opinion.

NiN

 

[Now is Now]

Quote from clambill:

I noticed something on Friday. The EUR/CAD and USD/CAD did about the same move, which was to skyrocket on the Goldman Sachs news. Then I noticed they've gone down the last several weeks. Does anybody think it would make any sense at all to short the USD/CAD if you think the euro is going down? This is because I think the spreads on the USD/CAD pair might be more liquid than the EUR/CAD pair (meaning tighter spreads, it's 12 pips for the EUR/CAD with FX Open on a micro lot account).

Personally, don't follow this pairs stuff...but can only suggest that there is a strong correlation between oil and Canadian dollar ,Norweign krona and Mexican peso....the latter may be on a trip wire as their economy and political stage becomes unravelled for the umpteenth time.

As for the euro/CAD relationship...no idea.


NiN