DB 1010308

Stefano Piovesan Daily Briefing 100308

1.  Review.

Better than expected USD data boosted “Risk on” return and it was fine for my positioning. JPY unwind stopped as expected. Risk on was more against JPY (lost against USD and AUD) than positive for USD (expect versus JPY)

Trades

My naked positions in the wrong side looks better. Got 110 pips profit with a long USDJPY.

I missed the opportunity of add another long at the 88 level.

2.  Analysis.

"Fundamental analysis"

Greece clarified position and this may edge short term EURUSD. Low inflation (1% y/y) would suggest that ECB rate hike are not expected and the widening interest differential will impact negatively on EURUSD long term (3-6 month). Macro data were good for USD, giving boost to risk on sentiment. Continuously conflicting indicators, some inspiring confidence in the rebound and other opposite, suggest a continuously change in risk sentiment and a short term outlook, causing prices to remaining in a price range, without a clear trend.

"Technical analysis"

JPY losing ground and back to the middle of the grid (90), after a test of the grid low. UBS 3 month forecast is 95, EURUSD tested again the 1.35 level for the fourth time , without breaking. Price are still in the 1.35-1.37 range. UBS 3 month forecast is still bearish 1.30, but there is not a clear low break. COT report shows a small gain (-67k) versus the historical high of short positions in EUR (-71), while position in USD are all time high.

"Market dynamics"

No relevant new are expected this week: the Greece situation looks solved, unless the popular riots get hard. US data are expected to confirm actual positive trend, especially on the job side. I look for a consolidation of the risk on sentiment; probably EURUSD could gain from this <it was true, but I added another short…>

Median grid

EURUSD GRID 1.3500 - 1.4100, short bias

USDJPY GRID 88.00-92.00, long bias

AUDJPY GRID 78.00-86.00, long bias

Basically a risk-on bias

Prices

US up at 1136, (Q4+)

GOLD at 1134 (Q4)

Crude 81.7

EURUSD 1.36 (Q4)

USDJPY 90.29, (Q3)

3.  Plan

EURUSD

Wait risk on assertion. I think it would be safe to square the current short if loss are exceeding 100 pips (1.3729). If risk on continues, I will wait 1.38 level before adding another short position. I expect only versus JPY to gain mostly from this risk on.

Comment:<I added instead a short at 1.3650 and I did not squared the 1.3530 position; both wrong moves and now price is 1.3770>

USDJPY

I think I can stay with long opened this level without fear as long my leverage is fine. The failed 88 test before the NFP give confidence that we are in a fine range: I will leave the long 19.96 opened and add another two long on a small dip (89.67), even if as exception to my grid entry rules.

Comment:<I did not wait the dip but I bought at 90.28>

AUDJPY

I will do B&B. I will enter long on the next yob level (81.32) as pullback 1:1, I will stop out on a level down (-100 pips).

Comment:<I did not (wrongly) enter the dip at 81.25; bad…>

EURNOK

Leave for medium term.

Comment:<I entered with not clear plan and without too much thinking a short at 8.018>

4.  Trades

4.1 open trades, their type & their value:

9 Open 26-feb-10EURUSD S 1.3537 Q1 1:1 B&B 1.3622 -85.0000 -62.1945778

6 Open 22-feb-10 USDJPY L 91.6900 Q4 1:1 B&B 90.29 -140.0000 -128.4911

4.2 Leverage

aggregate position size expressed as a gearing ratio (Ex = 1:1)

Total positions per currency

USDJPY +1

EURUSD -1

AUDJPY 0

Position

USDJPY +1 (-110)

EURUSD -1 (-85)

AUDJPY 0

4.3  Effect of planned trades

Account summary:

ActivTrades live account

Starting date: 1/1/2010

Starting capital: 233+100

Line in the sand level:  7,500

1.  Account balance (Settled trades) and growth as a percentage.  (12777= 1%)

2.  Account equity (Including open positions) .  (1268= 2%)

3.  Account equity if planned trades go wrong

4.  Pip distance to line in the sand level.  1250