Forex Forum Archive for 11/06/2004

Halifax CB 23:35 GMT November 6, 2004 Reply   
Spotforex - nice posts & right on. I do believe you are right re. the next little while; it could be fun and it will more than likely be damaging for alot of us. One thing the article that I mentionned earlier brought up - and would like to hear others ideas on - is that a major new player in the stock market is the foreign CB's. It's going to change the "rules", such as they are

Toronto - I just do short term trades - an hour is probably my outside timeline usually, though I will occasionally positions overnight or over a weekend. Personally I prefer the time from about 6:30 am Eastern (11:30 GMT) to maybe lunchtime Eastern (at the latest), that long enough & my decision making ability descends from it's normal low level to abysmal by then. But I probably tend to average 4 or 5 trades a day. I have been known to hold stocks for several days...

There are a whole lot of much better traders than me on this board; I just tend to be more open mouthed. I involve my self in this as much (if not more) for the mathematics as the trading, and I hate the idea of people having to suffer through some of the same idiotic mistakes I made (make) :)

GL/GT

hk 23:21 GMT November 6, 2004 Reply   
Spotforex NY what is your view for the euro? 1.35 before 1.25? tia

Spotforex NY 23:20 GMT November 6, 2004 Reply   
Happy hunting all!!!!!!!!

spot
FF member since 1997

Spotforex NY 23:20 GMT November 6, 2004 Reply   
why am I posting this advice now????

because the market is bent on testing the central banks resolve. I do not know where that threshold exactly is (but I have a very good idea).

The US employment data is the hint that data does not matter at this point. The market wants it to happen (intervention)

....The market wants to see where that line in the sand actually is......The central bankers may step up the rhethoric as the euro climbs above 1.30 but the market wants to see where and who blinks first...Fed or ECB.....

Spotforex NY 23:13 GMT November 6, 2004 Reply   
The retail platforms will be very happy to those who overleverage since they win when the custy loses......


Those 'new' to FX probably have not experienced the wrath of intervention (and I do NOT count the BOJ and their limited credibility in this area).......

If and when intervention comes..it will be both ugly and exciting. There will be false starts and rumors of Fed, ECB intervention if the euro climbs towards 1.35......hedge funds and big banks will 'spoof' the market at various times.

Gov't officials will take the verbal route, then agency basis...then maybe coordinated intervention......

My advice to all is 'get ready'. You will miss the first 100 to 150 pips of any confirmed intervention...even the 'professionals' will miss it when it is confirmed

- you will still have 3-4 big figs that day to print money (if your retail platform lets you...which is another big, big risk on the retail end of things).....but that is a ways away and you will be encountering a world of gaps and counter gaps as the jitters unfold.......

Spotforex NY 23:05 GMT November 6, 2004 Reply   
re: Friday's price action

I have stated this quote many times on the forum

'the market can act 'irrationally' longer then one can remain solvent.....'

I believe that the ccy market will be entering a new period of volatility in the coming quarters. Those 'new' to FX may be in for a real surprise if proper risk management tools are not followed.....

revenge trades may be detrimental to your fiscal health.

YVR MAXXIM 22:41 GMT November 6, 2004 Reply   
the undisputed leader in broking is Cazenove

http://business.timesonline.co.uk/article/0,,9072-1340371,00.html

http://www.cio-today.com/story.xhtml?story_title=Harmony-Gold-Makes-Bid-for-Gold-Fields&story_id=27694&category=ciobusbrf

Toronto Aviator 21:24 GMT November 6, 2004 Reply   
Ref Halifax CB 20:55 GMT 06 November

An excellent post, to which I completely agree. IF there were more traders like yourself and GEP on this Forum, it would be awesome.
Do you trade on an intraday basis, or, do you take more longer view with your trading style.

Enjoy your weekend, and profitable trading next week.

Halifax CB 20:55 GMT November 6, 2004 Reply   
George/Sandy - the big issue is that the market can move very fast in the wrong direction. If you have a chart of Friday's action look at the movement awhilke after 8:30 Easterm (13:30 GMT); wherte there was a very large pro-USD gap, followed by a swift decline. Even if you had bet the right way (shorted dollars) you would have to be able to have enough room to get through maybe a 30-40 pip adverse move to survive. If you had 8 contracts, that would have been maybe 320$ in buffer space; your dealer would have closed you down probably at very unfavourable terms.

With a 500$ account, just trade one contract at most. You'll probably lose it, but the education - if you write down your trades and analyze them (what you did right, what you did wrong, etc...) - will ideally be worth it.

Pecs Andras 19:22 GMT November 6, 2004 Reply   
Sorry, in my first sentence I meant risking 400 for a 48 USD profit

Pecs Andras 19:21 GMT November 6, 2004 Reply   
Sandy
The forex game is all about risk management. If you risk 400 USD for a 48 USD loss, that is a very bad risk/reward ratio. You should always try to aim for a better than 1:1 risk/reward ratio.
With the trade you suggested, you lose 50 pips and you are down 400 dollars. If you use a decent stop, say 30 pips, you can only do 2 bad trades and you get a margin call, because your acount will be down to 50 dollars. And 2 bad trades in a row in FX is not unusual, to say the least.

george 19:14 GMT November 6, 2004 Reply   
With a mini account of $500, how much would you suggest I trade with.You mentioned that if I trade with $400(8x$50 mini lots),I will soon wipe out my whole account.What does that mean?
Thanks
Sandy

Pecs Andras 18:58 GMT November 6, 2004 Reply   
Now I can see that you are actually Sandy. Sorry for calling you George :-)

Pecs Andras 18:57 GMT November 6, 2004 Reply   
George
In mini one lot is worth USD 10K, and 1 pip profit/loss is worht 1 USD. If you trade 8 mini lots, and you make 6 pips, that is 8*6*1=48 USD, assuming that your 6 pips gain is over your 4 pip spread.
But I would not do anything like that. You would be risking way too much. With five hundred USD capital if you trade 8 lots, you will soon wipe out your whole account. You should never risk that much on one trade.
But it is your money. GL and GT

george 18:44 GMT November 6, 2004 Reply   
I want to open a mini account of $500.Then I want to trade the EURO.Let us say I use $400(8x$50 mini lots) to buy EURO.
What will my profit be if I gain 6 pips after a spread of 4 pips?
Thanks
Sandy

Dallas GEP 17:45 GMT November 6, 2004 Reply   
Zappy, NEVER a sure thing. It was obvious BOJ was bidding usd/jpy up from 105.50 area last week. If this USD selling keeps up however I think they will stop bidding at 105.50 level and pick another level that is lower to defend. I think they are waiting to see if there are any usd bull retreacements which of course would releive pressure on that 105.50 area.

London Zappy 16:53 GMT November 6, 2004 Reply   
Any ideas on what level BOJ usd/jpy intervention is a sure thing?

Dallas GEP 16:48 GMT November 6, 2004 Reply   
From a personal standpoint, trading results last week were quite good after a change to much shorter time charts. 5 and 15 minute charts were used and sometimes 30 minute charts as well. As I posted before, I never bought much into using those shorter term timeframes because prior to that 30, 1, 2 and 4 hour charts were the ones I generally traded off on. BUT, I was not having the results I wanted or needed so the later part of the week I used the shorter timeframes and also paid more attention to the moving averages. Also generally I was looking to exit after 10-15 pip gains because of the choppiness in the market.

To me, usd/jpy was the safest pair to play because of the BOJ support line at the 105.50 area. Made 4 trips up and down on that pair. Eur/gbp also worked well because of the strong resistance at .7000. To me last week those were the only two levels that were relatively certain because resistance lines were being broken with regularity on EURO and GBP. The problem with that is it makes it hard to play reversals and continuations are hard to play with technicals indicating overbought areas. CHF and CAD pairs of course just continued to short.

Next week I will play short off that 7000 level on eur/gbp and long off that 105.50 level on usd/jpy. The usd/jpy level tho IMO is more likely to break than the 7000 e/p level IMO. Especially if we don't see ant usd bull retracements

Bogota Alex Fort 16:16 GMT November 6, 2004 Reply   
I am thinking working my FX accounts with censored from Virgin Islands. Anybody can help me giving me information about this firm?

London Zappy 12:18 GMT November 6, 2004 Reply   
//BC
Fine thanks. I only come out to play when the market is calling... and these days I only use options. I tried spots last year, but did not have the disipline. I often predicted the major moves, but lost money (a very small amount) due to stops too tight, and bad exit timing. With options you can afford to be more sloppy, and with experience, volatility is a big help. But I NEVER write options, only trade them. I guess I have a low risk profile. It amases me when I see people on the forum who don't use stops. I have big respect for all the SPOT people - too rich for my blood.

Your comments are always appreciated on GVI. Take care.

Ltn th 12:16 GMT November 6, 2004 Reply   
JP// Over the last two or more years there has been a lot of cosmetic interference with the US markets. This engineering can be argued to have made the previous recession shallower and shorter than otherwise and to have been unavoidable given the military situation. The need to have the economy appear in best light for the election also factored.
The situation we now face is that many needed corrections did not occur and those that did were of limited benefit. The probability of a serious recession now seems greater than any time in the last 4 years. The ammunition left to fight it very limited.
The scale of such a recession is difficult to quantify. 20%, 40+%, who knows. The parameters used to express these numbers are also interchangeable or inverse cofactors. Like it or not if you want dow and other indicators at 10k or equivalent then the USDX needs to be 65 or vice versa. Sure bonds can tweak the edges.
It sure looks like a lot of deficits need to be tackled.
The big plus is that the supposed baby boomer social security and medicare blow out is a nonsense if appropriate mechanisms are put in place. The doomsayers who trot out these nasty numbers overlook the existence of those boomers' children who are now approaching their serious wealth generating years and able to contribute to the pool for current needs and their own future needs. This is not selfishness by current generation but a natural and equitable consequence of any sort of inflation rate in a currency over a period of 50 or 60 years.

shanghai bc 12:00 GMT November 6, 2004 Reply   

ZAPPY -- Long time no see..Hope you are fine..Expecting a steady downward move for Dollar till the end of the year..Good trades.

hk ab 11:59 GMT November 6, 2004 Reply   
JP// I am not an expert in that area. Recently my jobs on the table are quite full. Thus, I ask for bc for his generous opinions.

BC//Thank you for your very quick reply :).
I think what como mentioned yesterday was the news of Chinese Yuan on bloomberg right now.

Mtl JP 11:56 GMT November 6, 2004 Reply   
Zappy 11:21 / US needs lower dollar in order to make Chinese imports more expensive at home. Priceinflation supposedly increases corp profits (which are softening you will notice), who when profitable and in theory, will (hopefuly) hire local labour (which, in revised from 4.3 to 3.+% growth economy, are not keeping up with pop growth). Else, in case we start to see signs of the Japanese disease thingie (price deflation) we ll start to see more of that Bernanke thingie (unconventional measures).

shanghai bc 11:52 GMT November 6, 2004 Reply   

AB -- I guess, as long as stocks and bonds stay firm,Fed would not mind if Dollar falls another 10% or even 20% by their overproduction of Dollars..The only folks who would be worried about at some stage must be the ones from Euroland and Japan..But given RMB's peg to USD and Asian cureencies de facto peg to RMB,I do not expect another huge downside of Dollar at this stage..But forex market is always full of surprises once momentum sets in ,especially so when the authorities fail to convey their certain wishes to forex traders for whatever reasons.

Mtl JP 11:31 GMT November 6, 2004 Reply   
ab 11:12 / Do you think the US politicos are able to run fixed -i.e. no increase budgets - for a few years ? What do you think it will take to half the deficit ?

London Zappy 11:21 GMT November 6, 2004 Reply   
I am convinced FED game plan is to raise rates whenever possible, for 3 reasons:
1) To make it easier to sell more paper to finance deficit
2) It sends the message that the economy is OK
3) It may keep the lid on inflation, even as the dollar drops (but this is only a slight reason)
4) It allows them to cut again from a higher level if needed!
IMHO...

London Zappy 11:14 GMT November 6, 2004 Reply   
Hey shanghai bc,
Do you think $ volatility is going to be much higher for next few months?

hk ab 11:12 GMT November 6, 2004 Reply   
bc//If Fed hikes and prints simultaneous, what could be the implication? Thanks very much.

shanghai bc 10:54 GMT November 6, 2004 Reply   

NT 03:57 -- Good evening..Usd/Chf 1.1800--1.1600 is a short-term oversold region..Expecting some 200-250 pip short-term bounce from that region..For medium-term,Eur/Usd 1.35-1.38 is likely to be a medium-term overbought region..It is highly likely that we may see Eur/Usd entering that region in coming weeks..And expecting some decent medium-term correction of some 500-1,000 pips from that region again..If Dollar falls on good news and on bad news,that says a lot about Dollar's momentum at present..I would keep selling Dollar on any decent bounce till we enter medium-term oversold region..Good trades.

Hong Kong Qindex 08:59 GMT November 6, 2004 Reply   
EUR/USD : If the market is trading above 1.2973 we should pay attention to all three curves (A, B & C) in the Quarterly Cycle.

LondonJoe 08:51 GMT November 6, 2004 Reply   
Agree RF - US assets will look quite cheap soon , and I am no expert but I imagine provide better returns than European Stox.

HK [email protected] 08:39 GMT November 6, 2004 Reply   

A very important factor to be taken into account is the DOW.

If that bull market will continue to higher prices levels, at a certain time we will have to admit that we are at least technically in a new bull market.

One has to see then the effect on the dollar.

So one may expect big capital inflow into the US; at least for a time.

About that Chirac:

BRUSSELS, Belgium — President Jacques Chirac of France on Friday called for a strong Europe to balance American might even as he and other assembled leaders appeared to back away from proposed changes to resuscitate Europe's economy.

That fool suffers from pathological hatred to the US, just can't
see a strong US.
The Americans will laugh at him and he will become more angry.

perrie como 08:25 GMT November 6, 2004 Reply   
Sry can you delete the previous post, as my clipboard memory get confused and throw down more than allowed.

sry again

perrie como 08:20 GMT November 6, 2004 Reply   
Guess if is still needed to read newspapers.. Opinions changing more than wheater :)





See more of the world that matters - click here for home delivery of the International Herald Tribune.
< < Back to Start of Article FRANKFURT European leaders sparred over currency policy on Friday as the euro rose to a record against the dollar, a development that could undermine the exports driving the region's fragile economic recovery.
.
As the euro climbed as high as $1.2970 in New York, Prime Minister Silvio Berlusconi of Italy said that the dollar's fall "is hurting exports," a stance echoed by his Austrian counterpart, Wolfgang Schüssel.
.
And President Jacques Chirac of France warned that the strengthening euro was "an important element that we have to integrate into our thinking."
.
"Europe would be well advised to consider what consequences this could have on its economic activity and in particular on its exports," Chirac said in Brussels during a meeting of European Union leaders.
.
But Chancellor Gerhard Schröder of Germany, who earlier this year demanded that the European Central Bank step into the market to halt the euro's rise, said that the euro's level was "not yet dramatic" and that German exporters were performing "brilliantly."
.
"We don't need to take any political measures," Schröder said.
.
The dollar has fallen against all major currencies in the last few months. Part of the reason for the currency's decline is America's huge trade imbalance, which means it must attract several billion dollars a day in fresh capital just to keep the dollar steady. Many U.S. economists and even Federal Reserve officials have said the dollar will have to fall to correct that imbalance.
.
Jean-Claude Trichet, the ECB president, in January described the euro's rapid ascent late last year as "brutal and unwelcome."
.
But at a news conference Thursday in Frankfurt, Trichet focused on the inflationary pressure resulting from higher oil prices and declined to directly address the currency. Instead, he repeated the position taken by Group of 7 finance ministers in a January meeting in Florida, saying: "Excessive volatility and disorderly movements in exchange rates are undesirable for economic growth."
.
The euro's climb delivers a mixed bag of effects to the diverse euro-area economy. On the positive side, it reduces the price of the petroleum that Europeans buy, since crude oil is denominated in dollars. And it dampens inflation by making other imports cheaper. But a drawn-out rise will eventually hurt European exporters, whose sales have spearheaded the current recovery.
.
"Euro appreciation will be a negative shock to Europe's corporate profits and growth," Stephen Jen, a Morgan Stanley currency analyst, wrote in a report to clients. "It will only be a matter of time before this is felt."
.
In contrast to earlier this year, some Europeans leaders, especially Schröder, seem more willing to let the dollar decline against the euro.
.
"Europe has recognized that the dollar has to fall, and that it's best to create smooth conditions for this change," said Julian Callow, an economist with Barclays Capital in London.
.
In late New York trading, the euro was at $1.2966, up from $1.2872 on Thursday, and above the record of $1.2930 set in February. The pound rose to $1.8562 from $1.8437. The dollar fell to ¥105.54 from ¥106.01 and to 1.1776 Swiss francs from 1.1878 francs.
.
Still, a free-fall in the dollar could prompt central banks to intervene. The Bank of Japan, for its part, has bought billions of dollars over the last few years to support the currency. Whether the Federal Reserve and the ECB would join for a round of coordinated intervention is an open question.
.
Callow and other economists said the bank would become concerned if the dollar sank toward €1.35, a move that could a pose the first challenge to the euro zone's system of economic governance, if it happens next year.
.
On Jan. 1, Prime Minister Jean-Claude Juncker of Luxembourg takes up the position of "Mr. Euro," the name being given to the two-year job of being chairman of the Eurogroup, the finance ministers of the 12 euro countries.
.
Juncker's position has often been compared to that of the U.S. Treasury secretary, who has the power to order Federal Reserve intervention in currency markets. But Trichet has emphasized his own claim to the title of "Mr. Euro," suggesting that the ECB will defend its role as the euro's guardian.
.
"We don't exactly known what Juncker is going to do, but he won't let himself be pushed around," said Allan Saunderson, an ECB watcher with Eurozone Advisors in Frankfurt.
.
.
Complicating the central bank's task is the danger that interest rates might have to rise to head off inflation, as higher rates would make some euro-denominated assets more attractive to international investors and put additional upward pressure on the euro.
.
On Thursday, the ECB left its key interest rate target unchanged at 2 percent, a rate it has stuck with since June 2003. But the bank also called the recent run-up in oil prices "worrisome" and noted that inflation rose at an annualized 2.5 percent rate in October, well above its target of 2 percent.
.FRANKFURT European leaders sparred over currency policy on Friday as the euro rose to a record against the dollar, a development that could undermine the exports driving the region's fragile economic recovery.
.
As the euro climbed as high as $1.2970 in New York, Prime Minister Silvio Berlusconi of Italy said that the dollar's fall "is hurting exports," a stance echoed by his Austrian counterpart, Wolfgang Schüssel.
.
And President Jacques Chirac of France warned that the strengthening euro was "an important element that we have to integrate into our thinking."
.
"Europe would be well advised to consider what consequences this could have on its economic activity and in particular on its exports," Chirac said in Brussels during a meeting of European Union leaders.
.
But Chancellor Gerhard Schröder of Germany, who earlier this year demanded that the European Central Bank step into the market to halt the euro's rise, said that the euro's level was "not yet dramatic" and that German exporters were performing "brilliantly."
.
"We don't need to take any political measures," Schröder said.
.
The dollar has fallen against all major currencies in the last few months. Part of the reason for the currency's decline is America's huge trade imbalance, which means it must attract several billion dollars a day in fresh capital just to keep the dollar steady. Many U.S. economists and even Federal Reserve officials have said the dollar will have to fall to correct that imbalance.
.
Jean-Claude Trichet, the ECB president, in January described the euro's rapid ascent late last year as "brutal and unwelcome."
.
But at a news conference Thursday in Frankfurt, Trichet focused on the inflationary pressure resulting from higher oil prices and declined to directly address the currency. Instead, he repeated the position taken by Group of 7 finance ministers in a January meeting in Florida, saying: "Excessive volatility and disorderly movements in exchange rates are undesirable for economic growth."
.
The euro's climb delivers a mixed bag of effects to the diverse euro-area economy. On the positive side, it reduces the price of the petroleum that Europeans buy, since crude oil is denominated in dollars. And it dampens inflation by making other imports cheaper. But a drawn-out rise will eventually hurt European exporters, whose sales have spearheaded the current recovery.
.
"Euro appreciation will be a negative shock to Europe's corporate profits and growth," Stephen Jen, a Morgan Stanley currency analyst, wrote in a report to clients. "It will only be a matter of time before this is felt."
.
In contrast to earlier this year, some Europeans leaders, especially Schröder, seem more willing to let the dollar decline against the euro.
.
"Europe has recognized that the dollar has to fall, and that it's best to create smooth conditions for this change," said Julian Callow, an economist with Barclays Capital in London.
.
In late New York trading, the euro was at $1.2966, up from $1.2872 on Thursday, and above the record of $1.2930 set in February. The pound rose to $1.8562 from $1.8437. The dollar fell to ¥105.54 from ¥106.01 and to 1.1776 Swiss francs from 1.1878 francs.
.
Still, a free-fall in the dollar could prompt central banks to intervene. The Bank of Japan, for its part, has bought billions of dollars over the last few years to support the currency. Whether the Federal Reserve and the ECB would join for a round of coordinated intervention is an open question.
.
Callow and other economists said the bank would become concerned if the dollar sank toward €1.35, a move that could a pose the first challenge to the euro zone's system of economic governance, if it happens next year.
.
On Jan. 1, Prime Minister Jean-Claude Juncker of Luxembourg takes up the position of "Mr. Euro," the name being given to the two-year job of being chairman of the Eurogroup, the finance ministers of the 12 euro countries.
.
Juncker's position has often been compared to that of the U.S. Treasury secretary, who has the power to order Federal Reserve intervention in currency markets. But Trichet has emphasized his own claim to the title of "Mr. Euro," suggesting that the ECB will defend its role as the euro's guardian.
.
"We don't exactly known what Juncker is going to do, but he won't let himself be pushed around," said Allan Saunderson, an ECB watcher with Eurozone Advisors in Frankfurt.
.
.
Complicating the central bank's task is the danger that interest rates might have to rise to head off inflation, as higher rates would make some euro-denominated assets more attractive to international investors and put additional upward pressure on the euro.
.
On Thursday, the ECB left its key interest rate target unchanged at 2 percent, a rate it has stuck with since June 2003. But the bank also called the recent run-up in oil prices "worrisome" and noted that inflation rose at an annualized 2.5 percent rate in October, well above its target of 2 percent.
.FRANKFURT European leaders sparred over currency policy on Friday as the euro rose to a record against the dollar, a development that could undermine the exports driving the region's fragile economic recovery.
.
As the euro climbed as high as $1.2970 in New York, Prime Minister Silvio Berlusconi of Italy said that the dollar's fall "is hurting exports," a stance echoed by his Austrian counterpart, Wolfgang Schüssel.
.
And President Jacques Chirac of France warned that the strengthening euro was "an important element that we have to integrate into our thinking."
.
"Europe would be well advised to consider what consequences this could have on its economic activity and in particular on its exports," Chirac said in Brussels during a meeting of European Union leaders.
.
But Chancellor Gerhard Schröder of Germany, who earlier this year demanded that the European Central Bank step into the market to halt the euro's rise, said that the euro's level was "not yet dramatic" and that German exporters were performing "brilliantly."
.
"We don't need to take any political measures," Schröder said.
.
The dollar has fallen against all major currencies in the last few months. Part of the reason for the currency's decline is America's huge trade imbalance, which means it must attract several billion dollars a day in fresh capital just to keep the dollar steady. Many U.S. economists and even Federal Reserve officials have said the dollar will have to fall to correct that imbalance.
.
Jean-Claude Trichet, the ECB president, in January described the euro's rapid ascent late last year as "brutal and unwelcome."
.
.... iht.com source

perrie como 08:16 GMT November 6, 2004 Reply   
BTW to Global View - (if there's any :)

the eur/jpy closing price is higher than the high on recent history ref nov 5

perrie como 08:07 GMT November 6, 2004 Reply   
Funny I ve just spotted an article on Chirac and Euro(pa), where he has changed mind from morning to afternoon (might be an Arafat syndrome :))

http://www.iht.com/bin/print_ipub.php?file=/articles/2004/11/06/news/eu.html

The summit meeting was the first test of Europe's willingness to forget differences and embrace the United States following the re-election of President George W. Bush.

perrie como 07:52 GMT November 6, 2004 Reply   
It was just Shroder commenting not frustrated particurlarly with current euro level.
Guess, if you take Chirac bearish comments during the day, that in Europa we do not have any clear direction nor governement, but maybe at the end might proove better to have more presidents. Maybe an evolution of democrasies :)))

van Gecko 05:46 GMT November 6, 2004 Reply   
hk mom 15:55.. good to hear you are now fat.. some real money m/t players practice staying fat in FX by learning to be patient & never chase the market at extremes..
Even tho it looks like the Dollar had easily 'sliced' through the 84.50 support on a good NFP Friday, not sure how much m/t real money was behind this move.. so be patient & let the market come to your comfort levels over the next weeks; add/reload on bounces in front of 86.50.. and if the Dollar is still under 85 by this time next week, add/reload on bounces in front of 84.50..
there will be many chances for discipline dollar bears to get fat trading their favriote pairs upon a confirmed break of 84.50..
have a nice w/e..

Halifax CB 04:24 GMT November 6, 2004 Reply   
In an article on the linked page, there's a somewhat disturbing concept put forward by Boris Schlossberg of f*x*c*m, that now central banks have become substantial buyers of US securities. Interesting how this scenario would allow the dollar to slide (since they could use US reserves for this purpose, there by pumping $ into circulation) while the stock market improves. One would also think it would skew the behaviour of the market somewhat, in that they wouldn't tend to invest in some of my own personal favourites (like some foreign based ETF's, of the ever-irritating NT), but would prefer the bigger boys, particularly ones not in direct competition woth their own babies (like transportation)....

What I find more interesting is the last two years the relatively tight relationship between the dollar and the market that I (at east) had always assumed to be there has unravelled somewhat (if it ever really existed in the first place). That's the one that says that generally the market strength correlates better with dollar strength; infact it seems to be quite the opposite. Here's a few plots I've done up at Yahoo for your perusal:

Eur/USD and the Dow

JPY/USD and the Dow

GBPUSD and the Dow

and finally
CAD/USD and the Dow


Note the base currency in the above is always the USD, which is a bit different for CAD and JPY than normal trading notation.

A similar (but not so strong) relationship holds over the last 5 years, and better for some briefer intervening periods interspersed with intervals of anti-correlation. I need to download myown data to look more carefully at that. Anyway, they are interesting graphs to play with; you can change the currency pair using things like "eurusd=x" for Euros/USD; "usdjpy=x" for dollars per yen, etc. Good w/e all.

SAIHAT No_one_will_escape 04:08 GMT November 6, 2004 Reply   
MAY FIRST RANGE


1.2933 1.2997

1.1739 1.1811

hong kong nt 03:57 GMT November 6, 2004 Reply   
BC -- do you think a trading range of USD/CHF 1.165~1.200 may work for next week? many good trades to you..

hong kong nt 03:57 GMT November 6, 2004 Reply   
BC -- do you think a trading range of USD/CHF 1.165~1.200 may work for next week? many good trades to you..

HK [email protected] 02:50 GMT November 6, 2004 Reply   


Euro:Next target may be completed at 1.2995/1.3000

Thus one may expect the open on Monday to be somehow higher than Friday close.

The above target is the key to what will happen next.
If the market will knock off the price from that target_high, one may expect a test of 1.2835 level.

Holding 1.2835 is an important precondition to rechallenging that target_high on the way to 1.3050.

If 1.2835 level will give way, the market will definitely challenge the Prev. Day low at 1.2760.

If that happens the Euro bulls, will try to fight it out to have a daily close above 1.2760(prevent daily key reversal)
If they fail we are on a daily key reversal on the way to 38.2% Ret. Just above 1.2500.
So may be, Monday is a day of wait and see for safer trading.

Other types of reversals, if happened may too be watched for.

Just remember the rule: Reversal signals are most reliable if they occur after a strong trend .

Any holding of 1.2835 support and/or break above 1.2995 means price goes to 1.3050.