I suppose we are at an interesting time in the market, today I was wondering whether in years to come this time will be pointed to as a market turning point, or will it become a continuation of the left side of the chart.
Very few commentators will choose the first, it’s way much easier to choose these times with hindsight.
Late March the USDX made a high, when it seemed that there was more highs to come there have been none.
In May The S&P made a new high, when it seemed that there were more to come …
In July Gold made a new low, it seems that there are more to come…
So will Gold move on down to 70.00?, if so then we may get the new highs on S&P and USDX, but thinking ahead, would I trade for these new highs, would I buy the S&P and target a new high, would I buy USD and wait?
These are transition times, the raising of US rates, the devaluation in China, either or both could be the catalyst for change.
That’s the thing; a lot of people prefer searching for that new high because it is “risky to try to catch bottoms.” and the “trend is your friend.” But trading that new high might not actually be the trend. It certainly was the trend, but there is no evidence that supports a new high yet (until we get something concrete from the fed on interest rates.)
For me I prefer to try to find the turning point in Gold (or catch the trend early) for a defined, technically clear, and very small risk area. Those to me are the best trades.
I will try to do a technical analysis on gold later today.
For the same reason I went long on EURJPY, well I had a signal at first. But without the logic or the sentiment signal just alone don’t mean much. Were you short on S&P ?
I have a hard time believing now Fed will hike rate in Sep, I think there maybe a big disappointment.
I’m in EURJPY long as well. I closed my gold position rather prematurely, although I don’t think there is a premature profit. I’m still with silver long as well.
I’m flat S&P, the spike took me out at b/e, quite happy with that, the range is narrowing, there is not the same optimism, before it was just a matter of buy and exit when in profit.
It’s possible that S&P traders might do some more buying, but I suspect they are watching the Chinese and hesitating - I see that some of the larger investors are buying GDX, maybe more to follow.
Hi Philip,
Couldn’t agree more, I always believe in taking the profit when the market is offering it, too often it will snatch the profit away if refused.
I’m flat on gold now also, to take profit counter trend is always a big achievement.
In hindsight EURUSD, EURCAD, or EURAUD would have yielded much more than EURJPY did. They all gave heads up yesterday onto early London. I’m out of EURJPY, and looking to short EURCAD and EURAUD but I doubt the short signal will come along today, probably tomorrow.
Pound is off the roof !! Did you guys notice ? I’m looking at the chart and thinking to myself, we’re in need of some correction “big” correction on pound crosses at the least. Did RBA intervene btw , AUD just sank.
this might be the week for changing long term trends for stocks imo. Dax is down anyway, s&p seems weak and nikkei also seems to turn.
Also interesting the decoupling of different commodities this week which makes the situation more complicated. Gold is up, silver about be and oil is down.
That’s the funny thing happening to me this year. Months ago, I had a signal to buy USDJPY and USDCAD. I decided to buy USDJPY. Then the Greece thing happened the JPY gained so much and closed my position for a loss. USDCAD on the other hand started the rally we are still in today.
Then I had a signal for EURUSD and EURJPY. I decided to do go with EURJPY but now EURUSD is doing better.
Having said that I’m quite confident of EURJPY long and JPY weakness in general. I think we will challenge at least 140. But I think the main target for EURJPY this year is at least the highs of 149.
I like this trade a lot particularly because I think Fed hiking rates will not have a drastic effect on it. If Fed doesn’t hike in September the Euro will gain and will surely make a big move. If however Fed does hike the Euro will go down, but so will they JPY and the damage (if there is any) will be limited.
The only scenario I see this trade not working is that the Fed hikes and that spreads fear in the market and they run to buy JPY. Seems unlikely, but it could happen.
So in 2/3 scenarios this trade looks good. So I fancy taking every EURJPY long opportunity I face.
That’s the funny thing happening to me this year. Months ago, I had a signal to buy USDJPY and USDCAD. I decided to buy USDJPY. Then the Greece thing happened the JPY gained so much and closed my position for a loss. USDCAD on the other hand started the rally we are still in today.
Then I had a signal for EURUSD and EURJPY. I decided to do go with EURJPY but now EURUSD is doing better.
Having said that I’m quite confident of EURJPY long and JPY weakness in general. I think we will challenge at least 140. But I think the main target for EURJPY this year is at least the highs of 149.
I like this trade a lot particularly because I think Fed hiking rates will not have a drastic effect on it. If Fed doesn’t hike in September the Euro will gain and will surely make a big move. If however Fed does hike the Euro will go down, but so will they JPY and the damage (if there is any) will be limited.
The only scenario I see this trade not working is that the Fed hikes and that spreads fear in the market and they run to buy JPY. Seems unlikely, but it could happen.
So in 2/3 scenarios this trade looks good. So I fancy taking every EURJPY long opportunity I face.
Yeah, there was talk of the Fed dropping the ‘transition’ part - don’t know whether they did but it reflects the feeling that change is underway.
The bullishness in Gold perhaps reflecting investors appetite for returns, they may see greater potential in Gold than in stocks - it’s not fear driven, rather return driven imo. Gold now playing it’s role as a currency and investment vehicle.
Similar thing on a micro level yesterday with Eur/Usd, shorting USD offered the better potential there.
I am back with GBP today, will maybe play it out until after the vote count next month.
For the same reason I went with EURJPY and avoided EURUSD at all costs. (There’s a rumor that BoC might start a QE that should boost CAD) EURJPY is doing good now hang in there. Unfortunately I’m out :eek:
I need to work on sticking with my original TP level, PA certainly wasn’t suggesting a reversal but price was frozen I figured I’ll be out. So you’re planning on holding EURJPY through ups and downs ? I certainly don’t think its going to be a smooth ride up. You’ve got to take profit sometime. 138.80 was my initial target, I think its a fair chunk. Last night I was actually contemplating EURCAD long on top of my EURJPY but the thought of doubling the risk put me off. And Fed release was due. Otherwise if I trusted my method /signal/ enough and went long I would have woken up to a pleasant surprise.
BoJ came in with some intervention again a rumor yesterday, on the other hand EURCAD was doing okay. Well the lesson learnt, it certainly does catch up unless there’s any surprise.
I agree with you that it won’t be a smooth ride. But I doubt I’ll take profit ant time soon. I’m only +60 at the moment. May be after a break of 139 I’ll consider.
ECB receive first payment from Greece, whilst EUR/USD not aiding exports in Europe Gutteridge highlighted the Greek situation, where the ECB have received the first payment today, and now he believes he can focus on other European fundamentals. However, he recognised that Greece isn’t on a path of debt sustainability. He moved on to the EURUSD, which at its current levels isn’t aiding exports, and despite being good for Germany, Gutteridge noted the lower level of competitiveness for peripheral European nations, with also the possibility of the Euro going lower. ECB monetary policy not getting tighter any time soon Gutteridge commented that it will not get tighter quickly, but we are seeing signs of improvement, such as Spain’s retail sales increasing and higher employment across the whole of Europe. Mir questioned this, who expects the ECB to come up with QE mark 2. To finish, he outlined that banks will have to move away from moderate lending to a more aggressive stance. - See more at: Monetary policy not tightening in the near future, QE mark 2 in Europe possible? | TipTV.co.uk
So I’ve been thinking, the fall in Emerging market stocks and the devaluation of Chinese Yuan is basically a pricing in of a September rate hike isn’t it?
One thing to be mindful of in JPY, although it appears that there are funds going into gold there is a chance that some funds will make their way into JPY as well, especially if there is some profit taking in Gold.
This could affect Eur/Jpy next week - especially if the S&P continues down, which looks reasonably likely.
Just a thought, though I seldom trade Jpy so experience is light.
Update: after that post the S&P fell substantially, in that type of selling the USD also took a hit, that helped Euro generally, if you have to sell USD in a hurry then Euro will gain.