Thank you for the welcoming.
FE, by sources, I didn’t mean links to articles per se. Where is the source to the fundamentals that you reference? The raw data. I will be going over the links you put in the original post and have looked into COT before but I know there are plenty of references to other data.
“New Mike” thanks as well. Did I read previously that you are still in the learning phase and will be going live in the new year? What are you using for the source of your charts you made?
EJ
Hi EJ,
I do not have a single source for fundamental news. I do go through various sites every day to check what is going on in the world. If there is something interesting that I did not know, but it could be either a short or long term influencing factor then I will read it.
FE
Hey EJ.
Well, who isn’t still in the learning phase? Sure I am.
For the last 3 yrs I’ve been devoting my every spare time learning the game. Given I have a full time job, I have made time for the market. I’m thinking it’s around 25 hrs a week I make time for ‘my business’.
I leave for work at 6am. So, I have made myself 3 hrs every day before work to actually to work on it.
That means I wake up at 2:30am everyday. And especially on the weekends (oh my favorite time of the week). I am devoted to my business. It will be 3 very short yrs come the end of next month.
And this entire time I have documented every move from every currency (the big 8).
This year was the year that I finally got smart and learned Excel. (Well, I still use the paper and pencil also). I have 6 tables now on excel that I import data to. Sure, it’s all manually. But, looks good anyway.
So, I wanted to mention that all my data I get is nothing but pure price, from the broker. It’s the charts everyone looks at. I surely won’t take anyone else’s work. I work mostly with each and every day’s closing price. Then I tally up the weekly candles also. Yeah, and the monthly ones too.
So, that’s about it in a nutshell.
Mike
Hey fellas.
Ok. Let’s look at how the month is progressing.
So, we have the bottom figure (bold) is the total for the day. The monthly running total is the top figure.
What do you guys see?
I’ll tell you what I see.
There has been a real change since last month. No longer do we have the Comms dominance. Just look at the NZD. Down like 14% !!
And you can see the reason why I have the colors the way I do, so we can easily see the Comm dolls. If you remember last month, they were on top, and led by the NZD also. But not any more. It’s a complete flip flop.
So, we’re pretty much around the half way point of the month. And I’m thinking it’s just gonna look like this. NZD on the bottom the whole time.
See, I’m losing pretty good so far this month. I’ve been with the Comms. Thought there was gonna be a turn around with the AUD showing great employment numbers. But, nope.
I’m switching over to the Majors. As soon as possible. (Yeah, watch the Comms tear into the Majors now)
Wait…I need to think about this. Don’t forget, tomorrow is Friday (ok, maybe it’s today for you guys now)
We know that there is profit taking on Friday’s.
I have to think.
Talk to me guys.
Mike
Guys.
FYI…this is what I look at, at the end of every day. I take a picture of the market. At day’s end. (All of that resets at the strike of 00GMT) This is what it looks like.
Mike
Ok guys. One more view. (maybe you can understand it)
The line-up is where they stand before the week starts. And don’t bother with the ratings.
What a big disconnect between the AUD, CAD, and the NZD.
Mike
Hey guys.
Welcome aboard EJ, I go on forexlive.com as soon as I open up my platform a great website with great content you can stay up to date with pretty much all things that move the market. I had this site suggested to me by Peter, he’s a great source as well I would turn to him for something that I didn’t understand, we all do.
And Mike, (its been a while) here’s some charts of pound crosses yeah AUD had an upbeat numbers (maybe the economy is finally transitioning from mining led to service led ?) judging from 12h view I disagree with your stance I think comms are going to get back in pretty soon I don’t know when but the pattern that I’m seeing on pound crosses suggest a bearish bias at least until they reach weekly oversold. Maybe you should have gotten back with the majors (I know its easier said than done) after that bullish engulfing bar (GBPAUD). I’m thinking of going short on GBPAUD soon certainly no follow through in asian session. Maybe I’ll wait for London open to save myself a trouble.
Euro crosses on the other hand did show some sign of a reversal correction whatever you call it but we’re down with euro for now.
Now one of the biggest credits to this thread is that since July 2014, we all agreed that the talk of hiking rates in summer 2015 was unrealistic.
Basically what any interest rate hike does, is make it more expensive to borrow more money. When you borrow less, you are likely to spend less. And when you spend less, inflation should slow down. The opposite applies when you cut rates.
We have already discussed why it could be time to hike rates in December back in the summer, it was because the Taylor Rule told us so.
However, thinking about the economy more thoroughly tells us may be we shouldn’t hike rates even in the 1st half of 2016.
Think about it, if they hike rates. People would borrow less, spend less, and inflation would decrease. and if we hit deflation, companies will lay off workers, unemployment will rise, spending would decrease, deflation would increase further and the cycle would repeat. Obviously this wouldn’t happen due to an 0.25% hike. But after several ones it could.
On the other hand, if the Fed doesn’t hike. Eventually wage growth would pick up, people would start borrowing and spending more and inflation would pick up. Even if inflation overshoots the 2% target into 3% or even 4%. At least the Fed has the tools to deal with that scenario. But if we enter into deflation and interest rates are at 1%, we have basically blown all the work of the past seven years.
Hey Philip.
I found this very interesting. Check it out.
The U.S. Economic Outlook and Monetary Policy - Federal Reserve Bank of New York
Hey Mike,
Very important speech, has not gone unnoticed by the banks even though on the surface it may seem different.
Dudley seems resigned to a hike, not what he feels is best, so best case scenario is to make it small and gradual.
So looks even more likely that the die is cast, Dec for a hike, recent moves maybe the set up.
BTW, should add, just my perspective, he is very much a dove, so most guys are looking to him for even the slightest shift of tone.
Hi Guys,
I believe the last 4 posts summed up everything important. I pretty much agree what Philip has written. In the thread we concluded a lot earlier that the rate hike will be delayed against most market expectations. And I also think it is dangerous, especially with very low commodity prices and that all CBs (except BOE) want to depreciate its currencies.
On the other side I have read Mike´s article and Peter´s comment and they both makes sense in hiking rates in December.
Summary: it doesn´t matter what I find logical or how I see it, the Fed decided to do something else so I just have to consider that in my trading.
Have a great weekend guys,
FE
Hi Peter,
there is an article from Forex Gump which is interesting for current EUR sentiment. It shows how mixed the different officials are on further stimulus.
Look at it:
Forex - What ECB Officials Are Saying About Additional Stimulus
In which camp do you belong to if your opinion was asked what to do?
Take care,
FE
Hi FE,
Jens Weidmann’s input carries much weight.
It often intrigues me how history can have such an impact on a person’s outlook, without perhaps them even aware of it’s influence.
Germany’s dislike of QE (money printing) can be traced right back to the Wermacht Republic, or so many historians state, during ww1 one USD was worth from 5 to 9 Marks , then the Mark devalued to 33 m per USD at the end of 1919.
For various reasons the Wermacht Government undertook money printing, strongly opposed by economists of the time. By end of 1921 it was 330m per dollar, 800m by end of 1922.
By November 1923, after some more printing the numbers are a little vague, but somewhere around 4,210,000,000,000m per USD
Finally, the government scrapped the old mark and inflation became controlled, the lesson was learned.
Reality was that money printing was only one of the causes, having to repay reparations in foreign currencies was also a cause, effectively selling the Mark to buy foreign currency, the selling driving down the Mark’s value and so on.
Mr Weidmann commands much respect in Germany and in the EZ so his influence will likely be felt, Draghi and the ECB will not wish to push him too far.
(Apologies for the history stuff, just thought I’d put my view into context.)
Wow, thanks for sharing this! I didn’t know that much about Weidmann myself but this definitely puts things in perspective.
Hi Guys,
interesting week, would be good to know Mike´s stats and where he positions himself. Forex Gump had an article today, I wrote there my opinion, we had some different viewpoints. He looks at the markets as risk off sentiment, looking at my trades and exotic pairs, for me it seems like a clear risk on sentiment where CHF and USD loses ground. I would be happy to read your thoughts on it.
FE
Hi Peter,
I have seen an interesting post from you in another thread. It is off topic here, but maybe our team finds it interesting and that is the reason why I answer here and not in the other thread. So you worte about a difference for account negative balance account protection for UK and US traders. Why is there a difference? Isn´t the same rules apply for everyone? And what about the other countries of the world? Are the protections should be carried out by the country where the broker is registered? Maybe you can post us a useful link what you always do.
Thanks and take care,
FE
Hi Philip,
I hope this post gets to you. I studied today gold and silver in the cot report. I also observed long term charts and something got my attention at gold (silver showed nothing interesting which might be strange). Gold is heading to the territory where Commercials are near to the “0” position level which is always good to watch out as gold rallies are about to come. More than that, COT index signal might come in 1-3 weeks to buy gold.
What do you think on that?
FE
Hi FE,
I have a good friend who works in compliance with hedge funds, many clients are registered in various islands. Those companies have a great many hoops to jump through costing a lot of money just to comply with regulatory bodies that are often regarded as ‘second world’.
But perhaps the most difficult set of regulations, not necessarily the better for it, but certainly the most bureaucratic is the CFTC.
They seem to take the theme of ‘protection’ to a different level, their focus on protection is to dissuade traders from taking undue risk, therefore rule CFTC 5.16 rules out, or so it seems, the possibility of a broker from forgiving a negative balances.
https://www.law.cornell.edu/cfr/text/17/5.16
I have seen emails from US brokers quoting this rule, those same brokers offering negative protection to UK clients - those emails state : “Negative Balance Policy - Traders shall at all times be liable to … for any negative balance or debit balance”.
Not the fault of the brokers, therefore I will not quote their names.
Maybe things are changing, the focus of my research, I’m up to April this year.
Negative balances are rare, or are they, aside from SNB back early this year, I have encountered some on Euro swings with QE, although they are more prevalent with share trading.
Here is a salutary lesson for anyone wishing not to risk more than they can afford to lose, a story doing the rounds over this past few days:
Edit: the link to the US Govt info - just the same only more words:
Update to above.
It seems the position is unchanged since April as far as US is concerned, Jason from FXCM has responded in the thread you mention and has quoted the above CFTC rule.
Strange type of scenario, but if you are UK then you are covered, if US then not - next question is does a non US trader pay for this ‘insurance’?
