Few points against shorting EUR/USD

Profit, I read on Yahoo Finance that they are estimating about $130 BILLION will be repatriated. I don't have the link. As far as my own personal opinion, $130 BILLION is a lot of money. All of those who have traded forex for a long time know that a $1 BILLION order can move the market 50 to 100 pips in a matter of minutes. I read on GAIN Capital's dealer commentary that they are expecting most of the HIA flows in by December 15th. This is definitely good for the USD bulls and will form the foundation for the bigger wave 3 that I am planning on catching in USDCHF. Right now we are probably in a bigger wave 2. A downward trending USDJPY, a double top on USDCHF, and a triple bottom in EURUSD leads me to this hypothesis.

Regards,

Deptrai
 
Chood, I give thanks to the Lord on that USDCHF trade. :D For any of you guys reading this, it is just a private joke between Chood and Deptrai.
 
Quote from Deptrai:

Profit, I read on Yahoo Finance that they are estimating about $130 BILLION will be repatriated. I don't have the link. As far as my own personal opinion, $130 BILLION is a lot of money. All of those who have traded forex for a long time know that a $1 BILLION order can move the market 50 to 100 pips in a matter of minutes. I read on GAIN Capital's dealer commentary that they are expecting most of the HIA flows in by December 15th. This is definitely good for the USD bulls and will form the foundation for the bigger wave 3 that I am planning on catching in USDCHF. Right now we are probably in a bigger wave 2. A downward trending USDJPY, a double top on USDCHF, and a triple bottom in EURUSD leads me to this hypothesis.

Regards,

Deptrai
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Thanks, but I am surprised.
Honestly I've heard different HIA info.
Someone told me it was 500 billion already in the first half of 2005 and 200 on it's way later, but only half of it went through FOREX since it is already converted in most cases.

Some traders say it may be up to 300 billions left and noone knows how much will go through FOREX. Assuming the 50% exchange rate - then your estimate of 130 billion is rougly right.

This will make a total of ~ 1000 billion dolars for the whole 2005!

- but I can't be absolutely sure since it was all spoken.

I remember reading about this issue in 2004 but it was said the total amount would not exceed 300B and the Eurozone would participate with 50-60 B only.

What a mistake, right?

I think HIA flow end will cause a supply shock in the FOREX in January 06.
 
Quote from MrProfit:

This will make a total of ~ 1000 billion dolars for the whole 2005!
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To put that in some perspective: if so, 1,000 billion dollars in the course of a year, while obviously a nice chunk of change, would represent about 1/2 of the average daily forex turnover, usually estimated at some 2 trillion.
 
Quote from late apex:

To put that in some perspective: if so, 1,000 billion dollars in the course of a year, while obviously a nice chunk of change, would represent about 1/2 of the average daily forex turnover, usually estimated at some 2 trillion.
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WoW! So you read FOREX flyer advertising???
You're smart!

I am sure you know US M3 is roughly 10 000 billion USD.

http://www.federalreserve.gov/releases/h6/

10% of it is so insignificant, right?
I am also sure you know the turnover on EUR/USD itself.
Well, I am ready to learn that from you.
Don't forget to mention the real money as % (percent) of it.
I hope it helps me understand the insignificance of 1000 billion dollars and how liquid the market is.
 
Anyone else open a long position last night when it dropped? I am up almost 100 pips :)

I don't see it trending up yet like most people are saying.
-kastro
 
Quote from MrProfit:

WoW! So you read FOREX flyer advertising???
You're smart!

I am sure you know US M3 is roughly 10 000 billion USD.

http://www.federalreserve.gov/releases/h6/

10% of it is so insignificant, right?
I am also sure you know the turnover on EUR/USD itself.
Well, I am ready to learn that from you.
Don't forget to mention the real money as % (percent) of it.
I hope it helps me understand the insignificance of 1000 billion dollars and how liquid the market is.
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Actually, never seen a "FOREX flyer advertising" in my life, so I wouldn't know what it looks like.

Your (weak attempt) at sarcasm doesn't ruffle my feathers one bit, as I'm fond of sarcasm myself.

However, for best effect, good sarcasm requires that you get your facts straight, for starters.

To wit: who said anything about "insignificant"? My observation was about perspective, something you appear to lack. Look it up, it's good for you.

Second, for intraday trading, all that is irrelevant and only leads to undesirable bias. One of my core beliefs as a trader is "Trade what you see, not what you think."

Third, sure, I'll gladly educate you on the daily EUR/USD turnover. According to the most recent, 2004 annual report from BIS (The Bank of International Settlements), it averages 40% of the estimated mean USD 2 trillion daily interbank volume, or USD 800 billion. The yen is 2nd with 20%, and cable 3rd with 10%. Enjoy... no charge (for now).
 
Quote from late apex:

Actually, never seen a "FOREX flyer advertising" in my life, so I wouldn't know what it looks like.

Your (weak attempt) at sarcasm doesn't ruffle my feathers one bit, as I'm fond of sarcasm myself.

However, for best effect, good sarcasm requires that you get your facts straight, for starters.

To wit: who said anything about "insignificant"? My observation was about perspective, something you appear to lack. Look it up, it's good for you.

Second, for intraday trading, all that is irrelevant and only leads to undesirable bias. One of my core beliefs as a trader is "Trade what you see, not what you think."

Third, sure, I'll gladly educate you on the daily EUR/USD turnover. According to the most recent, 2004 annual report from BIS (The Bank of International Settlements), it averages 40% of the estimated mean USD 2 trillion daily interbank volume, or USD 800 billion. The yen is 2nd with 20%, and cable 3rd with 10%. Enjoy... no charge (for now).
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What exactly do you mean by "the most recent 2004 annual report from BIS"?

I am just curious:

What period of time is being discussed here? Calendar 2004 or what?
 
late apex???

Are you still there? What happened? The question was too difficult?
I am afraid you might want to leave us without the proper explanation, so I must clarify few things here myself:
There is no such thing like a study on FOREX volumes in so called "2004 annual report from BIS".

You see, you missed the actual report on that. The discussed data is in the Triennial Central Bank Survey of Foreign Exchange and Derivatives Market Activity in April 2004. There is no such analysis anywhere else. This report is indeed made by BIS. So you were close.

Now to make your life more difficult they published different numbers on the volume.
The estimated total volume was ~1880 billion daily. Of which 44.35% was USD by itself only.
You said EUR/USD makes 40% of the total volume and in fact it is 28% of global FOREX volume.
The amount observed was 501 billion + ~30 billion that was estimated in gaps.
I don’t know where you found this 800 billion, but all the numbers you provided are false.

Now let's get back to your statement about insignificance of 1000 billion dollars of real money flow in FOREX. Let me be polite here but your statement is incorrect and it is an obvious mistake people make by reading the false advertising on FOREX. You see 95% of the trade is just speculation. This is why the market is very sensitive to the real money flow.
 
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