1. Review.
I said “After testing is 1.35/6 levels, I see EUR 1.37/8 as topping level, as final point of the short unwinding. Probably it will be a sell on strength. Probably will not stay in the 1.40 levels too long. I see the 1.30 levels as a strong support level. I will use these strong EUR levels to establish more fundamentals short EUR.” EUR stayed all week long at 1.37 levels before going back to beginning of week 1.36, also due to a risk off for Egypt issues. “Gold and silver could trade at lows this week and can be time to establish long bias positions, due to renewed interest in the metal because FED would keep rates low for a for the extended period of time.” God did not move that much .”I will buy USDJPY probably in the 81 area”. Not yet. A quiet week.
Trades
No trades.
2. Analysis.
"Fundamental analysis data"
Japan S&P downgrade to AA-
USD statement to maintain 600bl stimulus
US unemployment claims back to 450k
ZEW German data: 15.4 (6.5 4.3) surprised to upside
US GDP 3.2%, (5.2%, 2.6%)
"Fundamental analysis"
Spain is taking action to solve the Cajas banks, hurting finances in the short term but for long term benefits. Government announced a drop from 9% to 5% in deficit for the 2010. Anyway you will need some strong PIIGS reason to cause the EUR to go south 1.30, and probably also some buy USD reasons.
JPY downgrade has caused not much impact on forex because only 5% of debt is hold by foreign.
RBA is on hold for longer than anticipated for the flood issues.
"Technical analysis"
EURUSD was stuck at 1.37 level for all the week. COT data are below. EUR long jumped very high. USD close to 78.28 (-0.1); USDJPY traded stable in the 82-3 area. Gold at 1.342; US futures up to the 1279 (+9). Oil at 89.06. GOLD/Oil ratio stable, little rising; VIX stable to low levels.
COT USD up to 14k (-20.2k)
COT JPY up at 49.1k (+29k)
COT EUR at 72.7k (+20k)
COT AUD down 42.9k (-17k)
TYN up to 3.32% (-0.08%)
JGB at 1.2% (+0.0%)
Bunds at 3.1%. (+0.0%)
German/Greece up to 8.3% (+0.2%)
VIX down to 20.4 (+2) Jump!
Gold/Oil up to 14.9 (-0.2)
"Market dynamics”
After testing is 1.35/6 levels, I see EUR 1.37/8 as topping level, as final point of the short unwinding. Probably it will be a sell on strength. I maintain bullish view on EURUSD, but probably it will not stay in these levels too long. I see the 1.30 levels as a strong support level. Technical picture suggest a EURUSD reversal. I will do some quick short, waiting for the next week job report. I would establish long position at dips, like 1.34/5. I will buy USDJPY in the 81 area. Risk aversion for Egypt event should be considered.
Median grid
EURUSD GRID 1.300 - 1.360, grid change up bias
USDJPY GRID 80.00-84.00, up bias
AUDJPY GRID 73.00-81.00, up bias
Prices
US at 1270, (-20, new grid Q2),
GOLD to at 1336, (-6, Q4+)
Crude 89.4 (+1.0$)
EURUSD 1.3610 (+0.000, Q4)
USDJPY 82.12 (-0.5, Q2)
AUDJPY 81.6 (-0.07 Q4+)
3. Plan
EURUSD
Comment:< >
USDJPY
Comment:< >
AUDJPY
Comment:< >
EURNOK
Comment:< >
4. Trades
4.1 open trades, their type & their value:
1 Open 05-set-10 USDJPY L 84.2600 83.2600 Q4 0.2 B&B 82.1 -216.0000 -16.3000 -11.07
3 Open 13-dic-10 USDJPY L 83.4800 83.2600 Q4 0.2 B&B 82.1 -138.0000 -8.5000 -6.50
12 Open17-gen-11 EURUSD S 1.3270 1.3420 Q2 0.2 B&B 1.3616 -346.0000 -35.6000
Leverage
Aggregate position size expressed as a gearing ratio (Ex = 3:1)
Total positions per currency:
USDJPY +2
EURUSD -1
AUDJPY 0
Position
USDJPY -16, -8
EURUSD -34
AUDJPY 0
4.3 Effect of planned trades
Account summary:
Saxo live account
Starting capital: 1000
Line in the sand level: 7500
1. Account balance (Settled trades) and growth as a percentage. (10038=0.3%)
2. Account equity (Including open positions) . (10030= +0.3%)
3. Account equity if planned trades go wrong: 1011
4. Pip distance to line in the sand level. 6270, with gear (0.1) 12000
