Forex Forum Archive for 01/10/2004

Juneau CAR 22:43 GMT January 10, 2004 Reply   
San Francisco: When the CBO, IMF, Robert Rubin, Paul Oneil, and Greenspan and staff writeres of both Time and Newsweek (Alan Sloan for one) give warnings it is because they understand what is going on and are worried that others do not understand how dire things are.

Support for this admistration is based on cultural beliefs not financial logic i.e their support for god, guns and gay bashing-lol. Every move this administration has made so far benifits the administration's rich friends.

The very first thing bush did was cut tax's on the rich. Alan Sloan of Newsweek and many others questioned how much good these tax cuts would do. And as mentioned the congressional budget office said 75% of the deficit was the result of these tax cuts (lost revenue)! Now bush's immigration policy is once again set to help the business community to have cheap labor; not to mention the outsourcing - (which I am actually happy about, as I am willing to share our wealth with the rest of the world)

The republican congress keeps cutting beniftis to the poor while bush steps aside contrary to his campaign promises.

The baby boomers are coming on line right now and social benefits are going to mushroom. But most importantly is the theory of supplyside economics - it doesn't work the 12 years between 1980 and 1992 showed that. Yet that is what this administration is selling.

Cheers - I grew up in Richmond - across the bay.

Gaza Ibiza 21:58 GMT January 10, 2004 Reply   
Its all fine and well to talk of levels and extension..but a valued frd i spoke last week pointed out to me that trends hardly ever turn when we are looking for it! I sense that many are looking for a reversal. The play for the past two years has been rather simple ..Yield v.s the dollar..(forget chf) look for signs the ECB and BOE are ready to drop rates and you have your first indication that money may start to get out of carry trades..till then ..USD is being used as a carry trade IMHO!

Thess/nk 2004 nk 17:07 GMT January 10, 2004 Reply   
BC

i agree with u..

BUT remember that when Euro fell below 1.17 line took long* time* to bounch above it.For sure market is not statik but im expecting Euro to defend well not to lose 1.17 sooner this year around 1.1880/1.1950

Im watching 1.20 line Usd/chf..
Imo if will be below 1.20 this month and stay for a while 1.1880/1.1980 the next critical level is 1.1836 which will open the way to 1.15 and lower and Euro 1.30/1.38
For sure i looked and study Big chart many times b4 post but seems to be same story (and cant take this out of my mind until have a good prove) with E/J back 1999.

My 1.2888 E/$ didnt print yet and that was the first good sighn but not good enough for me.

For sure we cant be sure for the Top/Bottom of any currency to make our lifes easier, our trousers not wet ,and our pockets fat...but only Guess

The answer in 2004 is where really $ want to go vs all currencies...

The one who Guess it will be the No 1 smiling person in 2004.
GL GT
nk

London MJM 14:04 GMT January 10, 2004 Reply   
bc// Error= pls read 'some' instead of 'same'.. Sorry..

London MJM 14:03 GMT January 10, 2004 Reply   
bc// I keep reading your posts with keen interest. You may recall yr posting on the 3/1/03, when you mentioned GBP and the possibility that same may top out at 1.65-1.70.. We have a clear 'overshooting' with present lvls. and I have no doubt that the GBP is going to fall as quick as it came up in the very short term. Taking into account the fundamentals (UK economy= Trade deficit, budget deficit, extreme low savings ratio, housing bubble) the GBP shld be on the floor and not on the top.

shanghai bc 13:41 GMT January 10, 2004 Reply   

HAT -- Google is your best hunting dog..Good luck..

Ldn Hat 13:15 GMT January 10, 2004 Reply   
shanghai bc 12:49 Any ideas where I can get charts for US Index? Thanks

shanghai bc 12:49 GMT January 10, 2004 Reply   

AB -- For medium-term players like me,the next big money is in betting on slow and zig-zag Dollar bounce from around Dollar Index 85 towards 90-95 region which may take a few months or more..The Dolar may face another kick down from those 90-95 region towards a fresh low sometime this year..Gold and Aud may have the similar moves too..Of course,daily moves ,no matter how dramatic,are nothing but a small market noise as far as those players are concerned..All trends look invincible towards the end of its run though..Imho..

hk ab 0.88 eur/gbp 11:44 GMT January 10, 2004 Reply   
bc// Thanks for your nice tutorial.
With such overstretch overshoot, do you anticipate the snap back in the same way?

hk ab 0.88 eur/gbp 11:43 GMT January 10, 2004 Reply   
nt// Yes, indeed, as what I said, once when people yelled "Why there's a sudden 100 pips move in seconds in the opp. direction? Then, the clear l/t trend change will occur." Right now, interested to me is how eur and aussie people to tackle their high dollar. Maybe that's very good to China when all hot money flows to the low cost country. I think HK should re-emphasize on manufacturing 'cos the low rates of USD has brought about a lot of ccy advantage to us.

Forget about TCW dreams, HK people should be smart enough to find the way out.

With the lowest tax rate, lowest ccy rate, the most free economy, HK deserve a better future.

shanghai bc 09:47 GMT January 10, 2004 Reply   

AB 00:45 -- Good evening..The concept of fair value in any currency is largely that of cbers and economists and not much about trading ..Almost always currencies overshoot from the fair value areas some 20-30% in their medium-term trend and what makes all hard currencies range in reasonable areas overtime since we had this floating regime in 1971 must the ability of relevant cbs to control the currency ranges and their real economy's weakness or strength to support those ranges..ECB folks were not joking when they said Eur/usd was some 25% undervalued from the fair value when Eur/Usd was below parity levels two years ago..Same goes for BOJ when they were saying Yen was some 10-20% overvalued when it was trading around 100 some three years ago too..That is how these folks view the markets and try to guide the market..Of course,when US Treasury folks say "Dollar is still strong" when it is falling,they are begging the market to sell more Dollars..

Eur/Usd 1.15 as the medium-term fair value was the one given by ECB folks last year..Usd/Jpy 110 by BOJ folks and Aud/Usd .65 by RBA folks last year..I presume these are the levels they consider their real economies can cope with the currency strength without causing trouble to their real economies..You can see Euro and Aud are the ones which have very much overstretched from their fair value at present while Yen is still in comfortable area..

Perth AS 09:17 GMT January 10, 2004 Reply   
Hong Kong nt my sons birthday and lucky numbers/

Hong Kong nt 08:41 GMT January 10, 2004 Reply   
Sometime next Tue, the following may appear on Reuters

EUR/USD 1.3000
USD/JPY 105.50
GBP/USD 1.9000
USD/CHF 1.2000
AUD/USD 0.8000
NZD/USD 0.7000
USD/CAD 1.2500
EUR/GBP 0.6850
EUR/JPY 138.00
GBP/JPY 200.00

SanFrancisco tg 05:12 GMT January 10, 2004 Reply   
Juneau - That is certainly one concept I've seen pop up here and there. But it is also the scary/hype side. The variables are not so linear. I read some scathing warnings of double dip recession around two years ago. The same authors I now find are flashing scathing warnings of a US collapse through "supply economics" now that the double dip recession never materialized and they need something else to fill peoples heads with.

The reality is a much different scenario, allowing for some fluctuation and an imperfect recovery of course.

Yes yes yes, the deficits are balooning. A study into the how a manufacturing economy behaves in such conditions vs how a "service economy or consumption economy" behaves will yield different results, and then you have unique variables to add. The US is obviously transforming into the second classification.

In truth, the deficit can be knocked in half through any number of means including tax reform (which does not equate to an increase but rather a systemic change) which may be forthcoming hopefully. Bear in mind Bush opponents have tried to block such measures in the past as it draws from social programs (they say) and the public buys it, when in truth more funds are made available). Again, this is still including the fact the US economy bahaves fine with deficits and good managers can manage them as economies grow and they even serve a purpose.

There is a point where lines must be drawn, I believe this administration intends to get them put into law for the first time in the near future, as this is the first time in recent history the opposition does not have enough of a blocking representation in government.

Other factors include rebalancing the inequities of strong dollar vampirism which effect export and consumer pricing and so forth. Basically it boils down to economic war where damage from prior years must be corrected and pain inflicted elsewhere outside the US after being gouged, which of course can be seen in areas such as France, a wonderful partner of the US 100 years ago, but not recently.

Hong Kong Ahe 04:55 GMT January 10, 2004 Reply   
Hong Kong HSBC bank has announced Friday a rate cut on saving effective 12Jan2004. The deposit of HKD100,000 will only get HK1 (one HKD) p.a. for saving account. Prior is HKD10,000/HK1 int. Other banks in HK will follow too. It is foreseen people and corporations will further switch their asset either to stock/forex of those ccy with higher yield, NZD/AUD/GBP. There is an opportunity for zero/negative interest. One reason is due to the lower rate of USD (peg aftermath) and the other reason is current account of the banks keeping huge amount of daily surplus of hot money.

Juneau CAR 04:37 GMT January 10, 2004 Reply   
The thesis re the US folks is that they are using a descredited theory of economics i.e. supplyside economics. From 1980 to 1992 the US added three trillion to the deficit (the stimuls did not work!). When Reagon got in the deficits were 50 billion a year, he increased tax cuts to the rich by 100 billion and increased defense spending by 100 billion a year - 12X 250 billion a year is 3 trillion.

The CBO has said 75% of budget deficit is the result of lost revenue from the tax cuts! NOw bush adds a medicare prescription plan, baby boomers, etc,etc, and the feds have rates at 1% - no place to go!

The deficits are going to continue to rise. If the feds increase rates the housing market collapses and so does much of the stimulus and the stock market.

The only reson people keep buying our debt is becasue the stock market is making up the difference. If it falters what happens to the dollar??

As mentioned in the beginning supplyside economics is going to cause huge deficits. Why would the world invest in the zillions of dollars of foreign debt when everything looks like a fait acompli (sic?).

I am with those that believe the dollar falls all year. There are things the US could do, but as Bertrand Russell taught us if you are using an incorrect theory or axioms, you cannot expect the results you were expecting.

I am guesssing the rest of the world sort of knows this.

Saihat 04:34 GMT January 10, 2004 Reply   
there chance for gbpusd to go

1.8930
1.9410
2.0500

or higher

Hong Kong nt 04:27 GMT January 10, 2004 Reply   
HK AB -- wish me good luck of my short position at 0.7777...

Saihat 03:56 GMT January 10, 2004 Reply   
highest picks i see FOR GBPUSD
value not accourate
kagie charts

1.8933

1.9916

2.0730

2.4466

2.5843

2.6461

any one see these value

SanFrancisco tg 01:08 GMT January 10, 2004 Reply   
I'll bet the US works something out with New Zealand on the exports/currency situation .. good partners.

ICT ML 01:07 GMT January 10, 2004 Reply   
For those who use the FXTrek Desktop charts, I have been working with them to make some changes, and they have been very responsive. You might get the latest versions next week. Some things we fixed...you can freeze the existing trend lines and any other line in place, so they don't get dragged away while adding new lines. >>>>Setting>"enable Freeze Line Position when adding Line"

Also adding a transparent background so when you print them, your printer isn't printing the background colors......save you some ink..

And, they are changing the Add Fibonacci option to "Draw Fib Retracements" and "Draw Fib Projections"...so you can set up two different Fibonacci defaults if you want.

So, since GV is a FXTrek provider......wanted to let you guys know about the improvements. If you have other requests, let me know what they are and I'll run them by them.

I am not sure if the changes will be in the free and web based charts, I will have to ask them if these apply to them..

hk ab 0.88 eur/gbp 00:45 GMT January 10, 2004 Reply   
bc, your mentioned eur fair value is 1.15

How about aud,nzd and cad?
also chf?

Thanks!

I don't have doubt but seeing this gbp wants to go to 2.0000 this by this Spring.

SanFrancisco tg 00:29 GMT January 10, 2004 Reply   
Boy that sure flies in the face of reality. The New Zealand economy is soaring with personal wealth growing well, with even greater growth and GDP projected for 2004 than 2003.

I can see where there could be some exporter problems though. Perhaps the US can work something out with its good friend New Zealand. It is funny lately to hear a lot of people complain in Europe about how the terrible-nasty-insulting-bad mannered weak US dollar is out of line though.

Never heard a word out of any of you when the exporters had competative advantage with the US dollar being strong. It sounds like your spoiled kids who can't handle it when somebody tilts the totter their way. Looks like it all boils down to getting the gravy eh?

Perth AS 00:06 GMT January 10, 2004 Reply   

Exporters hit by dollar diveOfficial figures showed manufacturers shipped �2.27bn of goods to the US, against �2.5bn in October.

Perth AS 00:04 GMT January 10, 2004 Reply   
Dollar putting New Zealand Seafood Industry in ''Crisis Situtaion'' Says Sealord

SEAFOOD.COM NEWS [The Nelson Mail ]- January 9, 2004 -The high New Zealand dollar is costing Nelson based exporters millions of dollars and has created a crisisfor the seafood industry.

Sealord chief executive Doug McKay said his company was cost- cutting wherever possible, including a continuous review of labour expenses, as it weathered the fallout.

The New Zealand dollar was today trading at US67.05c, down only slightly from yesterday's rate of US67.36c - a 6 1/2 year high.

Mr McKay said the high dollar had thrown the seafood industry into a 'crisis situation''.

'It's a huge negative.