[ARCHIVE] FOREX - Trends, Forecasts and Consequences (Episode 14: April 2012) - page 97
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18.04.12. General uncertainty has spread to stock and debt markets.
18.04.2012 19:57 | Author: consortium | |
In my view, there are only two events today which were worth paying attention to, the fuss about the IMF reserve hike can be ignored for now. The BoJ has raised its forecast for consumer price growth in the current financial year to 0.5%. Until recently this value was 0.1%. In contrast, the BoJ still considers 1% as a target level for inflation and does not consider any tightening of monetary policy before that. In other words, the central bank sticks to its course and it can be assumed that there will be no tightening measures, i.e. easing measures are possible. Naturally, on this wave, the yen went back downhill again in the morning. There is a possibility of a continuation of the trend weakening of the yen against all.
The second event was the tightening of reserve requirements for financial companies by the Bank of China. Lately the Chinese regulator has started to interfere with reserve requirements very frequently. I believe that the Chinese are much more closely monitoring risk factors and are much more nimble than their European and American counterparts. It is better to intervene in time than not to intervene for years and then deal with what we have now. And demanding higher reserves is always preparation for possible strikes. So the Chinese are not just preparing. It is officially stated that this decision is due to a slowing economy, but I believe that the NBK is waiting for things to happen from the outside.
I am purposely not focusing on the Bank of England meeting minutes, the pound basically flew off on nothing. The asset buyback programme remained unchanged, but someone suddenly picked up a hint of accelerating inflation in the minutes, and hence a possible tightening of BoE policy. It is not going to happen in the near future, inflation as an indicator of economic growth is not bad, but if we consider the current state of the British banks which are still heavily burdened by their own debts, not counting the risks taken by the outside world, I would not count on a wild spike in lending, otherwise why should there be a growth in consumer inflation?
And I don't particularly want to talk about an increase in IMF funds either. Just words so far. Somebody expressed a desire to fill it, somebody welcomed the increase of the fund, but refused to do it. That is why there is a lot of hullabaloo around an event that has not happened yet.
On trading. A rule I've been using for years, which helps me in flat situations to keep some profits, to take from the market in portions. I have long ago stopped treating the market as an object to steal: we take out everything, right down to frayed galoshes. Personally, a couple of trinkets from the family jewels are enough for me. The rule is simple, we close 30-40% of the initial volume at the first strike, and immediately move the position to Breakeven. We add more positions only after the breakout.
For yesterday's sale of the euro the first boundary was 1.3075, which I marked on the hour chart. There I closed a part of sales and melancholy watched Euro and Pound dancing around. I am not going to buy yet. This looks strange, especially, because the price has almost tested the bottom triangle wall in the daily chart, rebounded and went up. The second doji is being drawn, which symbolizes the uncertainty about the currency pair. And where the uncertainty is, as I wrote many times, we go to the direction of the funding currency. In the stock markets, by the way, the picture is similar.
No other thoughts so far, though an alternative scenario seems to exist. So I sell Euro and see what will happen.
Mikhail Miroshnichenko (consortium)
The main thing is not the lines, but the foundation!
Dad
Look how it bites the resistance line (yellow), if it bites it will jump... and from the bottom it is blocking the upside support (red), thus creating a triangle
I have the following picture
Vizard, what is this interesting indicator?
it's a fairy tale)))
in mt4 you take a trendline and draw whatever you like )))...
Daddy
)))) keep him away from the computer again ))).
It's a fairy tale, not an indicator ))))
In mt4 you take a trendline and draw whatever you like )))...