The London Open - page 142
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Maybe my haircut was the turning point as we had one of those lesserspotted up days despite an awful ADP number that points towards an uglyNFP on Friday. In addition lots of concerns about GE's credit ratingand its AAA status. Lets look at this logically the US is rated AAA andsome analysts are doubting its rating so should we be surprised that GEis in danger of being downgraded? Answer in my small brain is a big fatno and in addition if there are a load of accounts who are forcedsellers on the back of a downgrade I am miffed, whatever happened toaccounts using their grey matter anticipating such moves? Much like myhaircut (which was a waste of 18 pounds) despite the rally nothing haschanged. I would like to remind you of a few crowded trades from thelast 10 years. Icelandic or Kazakh banks, .COMS, buy to let, Spanish orDubai property, Long commodities and LBO'S to mention a few. No prizesfor guessing what happened to these, I give you the 2009 equivalent.Long HG corporates, short government bonds and agency broking! Now notall crowded trades end in tears however at the moment I am struggling tothink of a contradicting example (answers on a post card please). Whichever article I read whether it be about pension fund deficits,healthcare deficits or annuity deficits the nuts and bolts of it is thatthere is not enough money around to plug these black holes. My wife,consumers, governments, are going to have to get used to spending lessand saving more going forward unless we delay the inevitable and pass iton to future generations.For the record much better day in EM specifically Kazakh that despitethe lack of news or clarity is making a steady comeback from the despairof a few days ago. Russian corps are still a nightmare to trade,illiquid and despite the rally in stocks and oil they still don't lookvery exciting in my book. The market feels ok at the moment, but Istill think selling rallies is the right strategy especially if Friday'sNFP is a shocker and gives us a stark reminder how deep in **** wereally are.
Mr P.......
London Open - Thursday 5th March
Good morning all
Interest Rate today in GBP and EUR.
Ok lets keep to our 250 pip week target. We have 10 sessions a week so that’s an average of only 25 pips per session. Only look for low risk, high probability trades and keep the consistency throughout the live sessions to make that 250 pip target.
CABLE
60min 20ma looks heavy with a lower high.
Supported on the 4hr 20ma as we speak.
Interest Rates today in GBP (midday) and expected to cut by 0.50% so GBP will be jumpy.
15min chart suggests support DP at 1.4117 and resistance at 1.4166.
Watch break of these levels.
Keep an eye on GBPJPY for help with direction.
EURUSD
Lower high on 60min chart.
Watch break of 60min 50ma on 15min charts.
Interest Rates today and expected to cut 0.50%
A break below 1.2575/70 level would signal weakness in EUR.
A tight stop above the 1.2610 level.
Watch EURJPY for the break of the 60min 20ma to assist in EUR weakness.
EURGBP
Looks very weak and you can play this with tight stop at 0.8915
4hr 50ma at 0.8890 and look for a break here for a move lower.
Watch GBP for support and EURUSD to break the 70 level.
JPY Desk - Thursday 5th March
Good morning all.
A great day for Yen traders yesterday with plenty of positive feedback from those of you who managed to make in excess of 200 pips. Well done to you all. Very encouraging!
Onto this morning…
USDJPY-
Needs ultimately to break through the 99.50 level for a push higher to 100.00
Going to be lots of resistance around this area I feel so do we really want to be going long at these levels for just 50 pips? No not really, but there is potential to stop and reverse.
GBPJPY-
Looks good to the upside IF it breaks 140.80 AND IF Cable tries to rally
Be careful with this pair as no correlation between USDJPY and GBPUSD as the moment, plus it’s interest-rate-day for U
EURJPY-
Needs to break WR1 at 126.00 for a push higher or below 124.85 for push lower, the latter being favoured at this moment in time.
There is a small area of 50 pips to the pivot so watch EURUSD which looks weak and look also for USDJPY to find resistance too much at .50 and to fall back.
VERDICT……
EURJPY short through 124.85 if USDJPY finds .50 too tough to crack and if EURUSD falls through 1.2570
--------------------------------------------------------------------------------
New York Open - Thursday 5th March
Afternoon all….
I have opted for the banana icon to help visualisation. I hop this helps.
This morning’s ‘verdict’ too some time to materialise, but a cheeky play between 60m 20&50 was just about worth waiting for and I hope most of you managed to pick up a little 50 pip play down to the support at pivot
This P.M see’s unemployment claims from US and also revised non-farm figures leading up to big day tomorrow!
Bad numbers should see USDJPY move down but might be a little volatile prior to breaking of the pivot and 60m 50sma at 98.85
So….
USDJPY-
• Needs to break 98.85 some 40 pips lower. Awaiting 15m trigger to cross south through 0.0 to play down to 99.00 and see what happens
• Not looking for long positions
EURJPY-
• Again, waiting for 15m trigger to show the way south back to pivot and 60m 50sma
• Not going long anthough potential double bottom at 12420
GBPJPY-
• Tricky pair today with interest rate cuts
• As with all yen pairs a virtually perfect bounce off 60m 50sma
• 140.25 (60m 20ema) is resistance now so if trigger crosses south then maybe opportunity if sterling weakens further
VERDICT………..
Keep an eye on USDJPY. If it remains below 99.40 and starts to fall off there may be a shorting opportunity on all yen pairs. Careful though, back above the 60m 20 so could be an area of the essence with 15m 20 having crossed negatively below the 50
Primarily concerned with 15m charts shorting all of the above should the triggers come into play.
Have a good afternoon
GOLD AUDUSD USDCAD - Thursday 5th March
Afternoon all,
Gold:
• Broke our 915 level and has retraced onto the 60 minute 20 ma.
• Looking for It to now find support off this level and start to move higher
• With silver also looking strong this should pull gold.
AUDUSD:
• Fallen through the WP and now also retracing to find resistance on the MA’s
• Will be looking for the triggers on this as a 123 play from around the 0.6430 level.
• If we break back through the 60 minute 20ma will have to reassess for a 123 up.
USDCAD:
• Boxed between the 4 hourly 20 ma and the hourly 50 and really needs a retrace back to the 4 hourly 20 ma
• Going long here requires too much risk.
GBPUSD , EURUSD - Thursday 5th March
CABLE
• Interest Rates came out as expected with a 0.5% cut.
• GBPJPY is holding the support level so CABLE should the 1.4000 level for now.
• Hard to trade at the moment until we get better direction across GBP.
• 15min chart suggest small weakness with 60min 20ma just above.
• Could be a cheeky short with tight stop at 1.4160 but watch GBPJPY for weakness for this to work.
EURUSD
• Lots of support around the 1.2500 level.
• 15min chart suggest small weakness below the 60min 20ma.
• A stop would have to be just above the 4hr 20ma at 1.2610
• Watch EURJPY for the break of its 60min MA´s for direction.
Hi all
I feel like i missed the train by 45minutes.
Everything was setup perfectly in EUR and GBP etc but we were too late. (5.00am is too early for me)
It happens.
See u monday as i´m not interested in NFP.
No notes and no summary video due to NFP.
Have a great weekend.
D
I have been told not to mention haircuts today so I will try not to. All I can say is my haircut has not stopped the rot with the markets. As I am writing all the old trades are rearing their ugly heads. Treasuries well bid, Commods off, Banking and Insurance stocks getting slammed, funding rates creeping up etc etc. Tonight's close is crucial, if we don't hang in there tomorrows NFP data is almost irrelevant. EM continues to smoke opium related substances and defies gravity. GE capital trading up front, GM on the brink, Citi bank shares below a dollar and Russian corps in parts better bid on the day! Flow from real money accounts is one way and its not buying, the corporates continue to stay afloat thanks to the dollar rich locals, how much longer this lasts for I am not sure. I remember once being told that there were more dollar notes in Russia than in the US, if that's the case then maybe corporates will defy gravity for the rest of the year. Kazakh was quiet today but buyers are still out there despite the noise elsewhere.One thing I don't know, or really understand is Quantitative Easing. Following the BOE's irrelevant 50bp cut today they announced plans to start QE including the purchase of corporate bonds. This part for me is an unknown quantity ie what corporates do they buy and how many? Same goes for the fed as you have to assume that as Gordon and Barack are now best mates (17 standing ovations, why?) they will be doing the same. If the UK can splash £150bn how much would the Fed splash and what temporary effect would it have on the credit market? I would stress this will only create short term distortions in the markets, long term market forces will always prevail and unfortunately this does not bode well for the future. The good news is that it's a Friday tomorrow!
Mr P.......
USDJPY broke 97.00 so GBPJPY and EURJPY have gone.
Couldnt resist.
D
London Open - Monday 9th March
Good morning all and trust you had an enjoyable weekend
Its the start of a new week. We have 10 live sessions so break your pips down and aim for your targets in a controlled manner. (250 pips a week should be your target!)
CABLE
It seems GBPUSD is lost and it can’t rally or fall away from the 1.4000/1.4100 level
There is a confused trend at the moment so keep it tight on a 15min chart.
GBP chart suggest a downtrend with the 4hr 20ma below the 4hr 50ma.
The 15min chart agrees with the 60min 20ma below the 50ma.
Its not easy but the only option for now is short plays into the respective support at 1.4090 and 1.4050 level on the 15min chart.
However with a huge amount of support in the 1.4000s I would be very wary.
Not an easy setup for CABLE today and I would tread with caution.
Watch GBPJPY and USDJPY as usual for help with direction.
EURUSD
60min chart suggests support around the 4hr 20ma at 1.2615 level.
A break through here would signal EUR weakness and use the 60min 20ma as resistance.
Safest play would be a 123 south through the 4hr 50ma.
If EUR holds the 4hr 20ma I would need to see a break above the 1.2700 level for confirmation of EUR strength.
EURGBP
Direction is mixed this am.
15min chart suggests support back into EUR for a move higher however EUR is weakening across the board at the moment.
Need to see a break of the resistance at 0.8985 for any move higher.
Wont be looking for any short plays unless we see a break below the 4hr 50ma at 89.10
Verdict
I am unsure at the moment and will wait for USDJPY to move and break the 98.40 / 98.00 level.
If the 98.40 level breaks on the upside then GBPJPY should hold up and give CABLE that much needed support.
Likewise on the south side.