Daily Briefing 100816

1.  Review.

I wrote “EURUSD rally seems to be likely to stay at the 1.32 levels, as median (now 1.28 and 1.35 levels would be the range); EURUSD bias is to be set to neutral.  Interest differential are playing a role now: the spread between EUR and USD 3 month labor is at 0.4 boosting the EUR. Rising EUR labor is not a worry if not accompanied by a falling USD labor. There reason that the spread will weaken in the next weeks signaling a medium top in EURUSD.  For the moment USD is still a sell and I will enter on long on dips below the 1.3 level” EUR was sold off after the Fed meeting stopping the weakening at 1.28 level. “Next week FOMC meeting will be one of the most important of the year. If further QE will be announced bond yields will fall sending the USD lower (good for JPY long). If not, that is Fed will not buy back Treasuries) there is potential risk for a Treasuries sell off, sending  yields and USD higher (good for JPY shorts).”  No QE, but just bad outlook for the economy from the Fed and there was a fight to safety with JPY strength, low US T-Note yields and EUR sell off. Anyway lower yields did not strengthen JY that much, maybe is a JPY bottom here at 85 level.  JPY regained 86 handle at the end of the week. “ German data are good and the ECB bonds buy back is about to close; other parts of EZ do not show any sign of growth, giving not much space for tightening.  There is then some space to the upside but the medium term is still mined from fiscal concerns”. Good German GDP data did not make EUR rise.
Trades
Holding the same drawdown at -560€ at the end of the week , still waiting for the risk-on increase to decrease the drawdown. Entered a EURNOK short the 12/08 at 7.955 and a EURUSD the 13/08 long at 1.2805

2.  Analysis.

"Fundamental analysis"
Last week was characterized by the Fed meeting that led to a flight to safety and a risk-off sentiment. After that,  employment data was a bad data as usual. Good data from inventory and retail sales. Good data come again from GDP German data, but it was offset by bad bond auction in Italy and bad data from the periphery. Gold jumped as fight to safety surged. Yield from EZ periphery surged as German yields felt. CDS for Irish are at the 17 months high. Friday data did not had a big impact on EURUSD, but boosted the USD some pips.

"Technical analysis"
EURUSD felled at the  1.28 levels. Even if long positions could be taken on this dip, there is potential USD strength. Long term upside move looks like limited, due to the austerity measures and the growth anyway slow. EUR COT short decreased again (-7k), USD long are stable (+12.3k), no more divergence and USD index is now in the 80 support area; JPY is increasing long positions long (+48k).  USDJPY traded in the 86 area. Probably is staying down here in these dips. US futures retested the 1100 highs, but there is a failure to close above 100 and 200 day MA. AUD are increasing (49k), showing a bias versus risk-on positions. GOLD/Oil ratio is raised at 16, from the 15 level since begin of July, with both oil down and gold surging;  but VIX jumped at the 26: did we saw a double bottom? Gold hit 1213, pointing to the previous high 1260 area.

"Market dynamics”
Even if a consider that one should  more focused on interest differentials these days are more oriented for a short term approach based on risk-on/off. USD weakness looks like already priced, but further slowdown could be led to EUR strength (WA says after price is bottomed 1.24).  EUR felled very quickly; 1.28 is a first support area, next will be 1.24. Irish bond auction should be monitored on Tuesday to see risk sentiment against EUR and CDS for Irish bonds. Short term financial data look like not supportive  for EUR . I will watch closely the 1.28 support to confirm the EUR bullish sentiment. Tuesday there will be lot of numbers from US, PPI, house data and manufacturing.  Regarding JPY and BoJ intervention I will monitor  1.  JGB yields (I see it on CNBC ticker) its 1.00% now. 2.  US 10 yr yields 2.72% now, low 2.67% since Fed. 3.  German bund yields. 4.  USDJPY price action during any risk off & risk on events.  Those data will help to determine if JPY has bottomed. Long term questions are:
- how bad will be in US or when we will see the bottom (is this bad outlook just a swing in the recovery)?
- will be the global recovery possible without the US?
- what will be the position of EZ (as anti dollar) and China (they carry the flag “the globe can go alone”)
This is the main story but speculative position will be more short term oriented and risk-on/off based.

Median grid
EURUSD GRID 1.280 - 1.350, (grid change), neutral bias
USDJPY GRID 84.00-88.00, neutral bias
AUDJPY GRID 73.00-81.00, short bias

Basically still a risk-off bias by the end of week

 Prices
US  down at 1081, (Q2)
GOLD up at 1213 (Q3)
 Crude 75.17
EURUSD 1.2767 (Q1)
USDJPY 86.23 (Q3)

3.  Plan
I will try again to work out of the money positions for JPY longs, just sitting on them for now. I will try to book the B&B long EURUSD and reenter position on a dip; I will monitor

 

EURUSD
I will enter a long B&B on the yob level (1.2958) as retracement; I will hedge on a couple of level down (-100 pips). I will take profit at 50-100 pips
Comment:< >

USDJPY
Already too many positions (+6)
I will enter a long B&B on the yob level (85.16) as retracement, if the 85 level is hold; I will hedge on a couple of level down (-100 pips). I will take profit at 50-100 pips
Comment:< >

 

AUDJPY
Already too many positions (+3)
I will enter a short  B&B on the yob level (78.31) as retracement; I will hedge on a couple of level down (-100 pips). I will take profit at 50-100 pips
Comment:< >

 

EURNOK
Hold short positions

Comment:< >

 

4.  Trades
4.1 open trades, their type & their value:

7 Open 13-ago-10 EURUSD L 1.2805 Q1 1:1 B&B 1.2769 -36.0000

2 Open  13-apr-10   USDJPY  L   93.2400 Q3  1:1 toe-in  86.23 -701.0000  
6 Open  05-mag-10   USDJPY  L   94.5900 Q2  1:1 toe-in  86.23  -836.0000
10 Open 06-mag-10   USDJPY  L   93.8600 Q3  1:1 Panic   86.23 -763.0000
16 Open 14-mag-10   USDJPY  L   92.3000 Q1  1:1 B&B 86.23 -607.0000
18 Open 02-giu-10 USDJPY L 92.2100 Q2 1:1 B&B 86.23 -597.0000
19 Open 30-lug-10 USDJPY L 86.3400 Q2 1:1 B&B 86.23 -11.0000
6 Open  04-mag-10   AUDJPY  L   86.0500 Q4  1:1 toe-in  77.23 -882.0000
7 Open  06-mag-10   AUDJPY  L   85.1300 Q4  1:1 toe-in  77.23 -790.0000
17 Open 03-giu-10   AUDJPY  L   78.8500 Q1- 1:1 Hedge   77.23   -162.0000

4.2 Leverage

Aggregate position size expressed as a gearing ratio (Ex = 4:1)

Total positions per currency:
USDJPY  +6
EURUSD 1
AUDJPY +3
Position
USDJPY -701, -836,-763, -607, -597, -11
EURUSD -36
AUDJPY -882, -790, -162

4.3  Effect of planned trades

 

Account summary:
ActivTrades live account
682Starting capital: 1366
Line in the sand level:  750
 

1.  Account balance (Settled trades) and growth as a percentage.  (1445=5%)
2.  Account equity (Including open positions) .  (9536= -3%)
3.  Account equity if planned trades go wrong: 1000
4.  Pip distance to line in the sand level.   2036, with gear (10) 203

Risk on/off or interests differential approach

“There are now two divergent views in the currency markets. One has traders buying the dollar as a safe haven when the US data is bad, and selling dollars moving into ‘risk trades’ when the economic data in the US is positive. The other view which has recently started to catch on has currency traders selling dollars on bad economic news in the US, and buying the greenbacks when the data is strong. This is a more traditional approach, and focuses on interest rate differentials. When the US data is bad, the thought is that the FOMC will be forced to keep rates low. On the flip side, when the US data shows a stronger recovery, a potential FOMC tightening moves traders to buy the dollar. Choosing which strategy to use is determined by your thoughts on the global recovery. If you believe the global recovery can’t happen without the US consumer, then you choose the ‘safe haven’ approach. But if you feel, as I do, that the rest of the world is going to be able to recover without a strong US consumer, then your focus shifts back to interest rate differentials and the global growth story.”
Form Daily Pfenning 8/6/2010

Daily Briefing 100809

1.  Review.

I wrote “EURUSD rally seems to be likely to stay at the 1.30/1 levels, as median (1.25 and 1.32 levels would be the range); The chances are that the EURUSD will go back in the grid or a clear break of the 1.32 level will bring it to the 1.33/4 area. and I will enter on long on dips below the 1.3 level”. EURUSD broke 1.32 level on Friday US job report. No decent dips before this move to enter a long position. “Releases this week will be important for US almost every day and I will look on that as confirmation about US weakness”. I will not expect a strong JPY against US;” USD lose ground versus EUR , JPY and AUD.” BoJ intervention is expected below 85. “ JPY Trade minister said he is very concerned about yen rise and they would need to take some action in future. “Long term outlook is still positive for AUD and CAD. Weakness of JPY cross are more for risk off view (JPY as safe heaven) then for bad fundamentals”. Anyway wome data below the expected was disappointing for the AUD.
Trades
Holding the same now “only” -526€ at the end of the week , looking for the expected risk on increase to decrease the drawdown. No trades this week.

2.  Analysis.

"Fundamental analysis"
Last week was characterized by a lot of US fundamentals; employment data was a bad data, despite some positive comment by US president, determining again a dollar weakness, suggesting again that this a recovery with no employment and just supported by government spending. Only good data were ISM for manufacturing and non manufacturing. Good data come again from EZ, especially from the German data. Gold after a sharp decline regained its levels and jumped on US job jamboree. Fed is expected calling for more QE and moving forward rate hikes expectances. This factor anyway could be already priced in and QE announcement could not weaken the USD.

"Technical analysis"
EURUSD jumped around 1.33 levels. Long positions could be taken on dips, but upside move looks like limited, due to the austerity measures and the growth anyway slow. EUR COT short decreased again (-7k), USD long are stable (+12.3k), no more divergence and USD index is now in the 80 support area; JPY is increasing long positions long (+48k). USDJPY traded in the 86 area. Probably is staying down here in these dips. US futures retested the 1100 highs, but there is a failure to close above 100 and 200 day MA. AUD are increasing (49k), showing a bias versus risk-on positions. GOLD/Oil ratio is stalling at 15 since begging of July, with both oil and gold surging; but VIX is not that volatile now at 21 support level. Gold after taking the 1156 lows high is now back at 1205, pointing to go back to the 1300 area.

"Market dynamics”
A good summary about the market sentiment comes from A Pfennig for Your Thoughts 8/6/2010; there are now two divergent views: the first is the risk-on/risk-off; they buy USD on bad USD data, as safe haven currency and they sell USD on good US data, moving into risk trades. The second has a more classical approach based on interest differentials; they sell USD on bad US data, because the interest will kept low and they buy USD when data are good, because of potential interest tightening. The last approach has recently got investors interest. I should chose one strategy based on the economy recovery expectation: if I think that the recovery cannot be without US consumers I will chose the first; if I think that the recovery can be without US consumers, but the rest of the world will be enough, I will chose the second, more focused on interest differentials. I think I will be for the second approach.
EURUSD rally seems to be likely to stay at the 1.32 levels, as median (now 1.28 and 1.35 levels would be the range); EURUSD bias is to be set to neutral. Interest differential are playing a role now: the spread between EUR and USD 3 month labor is at 0.4 boosting the EUR. Rising EUR labor is not a worry if not accompanied by a falling USD labor. There reason that the spread will weaken in the next weeks signaling a medium top in EURUSD. For the moment USD is still a sell and I will enter on long on dips below the 1.3 level. Next week FOMC meeting will be one of the most important of the year. If further QE will be announced bond yields will fall sending the USD lower (good for JPY long). If not, that is Fed will not buy back Treasuries) there is potential risk for a Treasuries sell off, sending yields and USD higher (good for JPY shorts). German data are good and the ECB bonds buy back is about to close; other parts of EZ do not show any sign of growth, giving not much space for tightening. There is then some space to the upside but the medium term is still mined from fiscal concerns.

Median grid
EURUSD GRID 1.280 - 1.350, (grid change), neutral bias
USDJPY GRID 88.00-92.00, neutral bias
AUDJPY GRID 73.00-81.00, short bias

Basically still a risk-off bias by the end of week

Prices
US up at 1119, (Q4)
GOLD up at 1205 (Q3)
Crude 80.82
EURUSD 1.3280 (Q3)
USDJPY 86.5 (Q3)

3.  Plan
I will try again to work out of the money positions for JPY longs, just sitting on them for now. I will try to enter a long EURUSD position on a dip; I will monitor EURSEK for a long if there is a retracement. I will add a short on EURNOK

EURUSD
I will enter a long B&B on the yob level (1.3020) as retracement; I will hedge on a couple of level down (-100 pips). I will take profit at 50-100 pips
Comment:< >

USDJPY
Already too many positions (+6)
Comment:< >

AUDJPY
Already too many positions (+3)
I will enter a short B&B on the yob level (78.31) as retracement; I will hedge on a couple of level down (-100 pips). I will take profit at 50-100 pips
Comment:< >

EURNOK
Hold short positions

I will enter a short B&B on the yob level (7.9) as retracement; I will hedge on a couple of level down (-100 pips). I will take profit at 50-100 pips
Comment:< >

4.  Trades
4.1 open trades, their type & their value:

2 Open 13-apr-10 USDJPY L 93.2400 Q3 1:1 toe-in 85.50 -774.0000
6 Open 05-mag-10 USDJPY L 94.5900 Q2 1:1 toe-in 85.50 -859.0000
10 Open 06-mag-10 USDJPY L 93.8600 Q3 1:1 Panic 85.50 -784.0000
16 Open 14-mag-10 USDJPY L 92.3000 Q1 1:1 B&B 85.50 -627.0000
18 Open 02-giu-10 USDJPY L 92.2100 Q2 1:1 B&B 85.50 -618.0000
19 Open 30-lug-10 USDJPY L 86.3400 Q2 1:1 B&B 85.50 -72.0000
6 Open 04-mag-10 AUDJPY L 86.0500 Q4 1:1 toe-in 78.48 -757.0000
7 Open 06-mag-10 AUDJPY L 85.1300 Q4 1:1 toe-in 78.48 -665.0000
17 Open 03-giu-10 AUDJPY L 78.8500 Q1- 1:1 Hedge 78.48 -29.0000

4.2 Leverage

Aggregate position size expressed as a gearing ratio (Ex = 4:1)

Total positions per currency:
USDJPY +6
EURUSD 0
AUDJPY +3
Position
USDJPY -774, -859,-784, -627, -618, -72
EURUSD 0
AUDJPY -757, -668, -29

4.3  Effect of planned trades

Account summary:
ActivTrades live account
682Starting capital: 1366
Line in the sand level:  750

1.  Account balance (Settled trades) and growth as a percentage.  (1445=5%)
2.  Account equity (Including open positions) .  (9474= -31%)
3.  Account equity if planned trades go wrong: 1000
4.  Pip distance to line in the sand level.  1974, with gear (9) 219

Daily Briefing 100802

1.  Review.

I wrote “EURUSD rally seems to be likely to stay at the 1.3 levels, as median (1.25 and 1.32 levels would be the range); It looks like that the EURUSD downtrend is broken and the EURUSD bias is to be set to long and I will enter on long on dips below the 1.3 level”. This was confirmed by this week price action, testing the 1.32 level and then staying in the 1.31 area. ECB slowed down its bong repurchase program. “I will look on that as confirmation about EZ strength and US weakness.“ Data from US confirmed US weakness “I will expect a strong JPY against US; BoJ intervention is expected below 85.”. JPY could benefit from a rising Yuan, then the 10Y note should be monitored for a sharp rise, that will call for a BoJ intervention (because in this case the JPY will rise due to the lack of support of US buying). US data ware confirming weakness in recovery. EU data instead confirmed an unexpected strong rise in economy.
Trades
Holding the “only” -487€ at the end of the week , looking for the expected risk on increase to decrease the drawdown. I entered a long USDJPY at 86.34, but I did not the 88 level short.

2.  Analysis.

"Fundamental analysis"
Last week was characterized again by a dollar weakness, undermined by a potential slow down in the recovery, with no good fundamentals data: low consumer confidence, low orders, no improvement on the jobs, slow down in the GDP . Good data come instead from EZ, especially from the German data. Gold after a sharp decline (option expiring date) regained its levels. Fed said that economy may not regain its path until 2016, calling for more QE and moving forward rate hikes expectances. There is a call for a deflation risk in US and the QE policy will be support it.

"Technical analysis"
EURUSD stayed around 1.31 levels. It would be not anymore short on rallies but long positions could be taken on dips. EUR COT short decreased again (-21k), USD long are stable (+14k), showing the big divergence is finally converging and USD index is slowly pointing to the 80 support area; JPY is decreasing long positions long (+29k). USDJPY traded in the 86 area. Probably is staying down here in these dips. US futures retested the 1100 highs, even with 68% of surprising earnings it did not rise that much. AUD are increasing (40k), showing a bias versus risk-on positions. GOLD/Oil ratio is stalling at 15 since begging of July; but VIX is still less volatile now at 24, but always suggest a uncertainness in the markets. Gold after taking the 1156 lows high is now back at 1180, pointing to go back to the 1200 area.

"Market dynamics”
EURUSD rally seems to be likely to stay at the 1.30/1 levels, as median (1.25 and 1.32 levels would be the range); like that the EURUSD downtrend is broken and the EURUSD bias is to be set to long. The chances are that the EURUSD will go back in the grid or a clear break of the 1.32 level will bring it to the 1.33/4 area. and I will enter on long on dips below the 1.3 level. Risk sentiment, that is giving boost to the EUS, is still uncertain and I will not buy on a breakout. Moody’s downgrade comments and end month portfolio balancing weighted on US last week, but this week economic data can do the same to weight the USD. Some technical factor could support US anyway. Releases this week will be important for US almost every day and I will look on that as confirmation about US weakness. High uncertainty is still alive and short term view should be taken. I will not expect a strong JPY against US; BoJ intervention is expected below 85. Long term outlook is still positive for AUD and CAD. Weakness of JPY cross are more for risk off view (JPY as safe heaven) then for bad fundamentals.

Median grid
EURUSD GRID 1.250 - 1.320, (grid change), long bias
USDJPY GRID 88.00-92.00, neutral bias
AUDJPY GRID 73.00-81.00, short bias

Basically still a risk-on bias by the end of week

Prices
US up at 1099, (Q4)
GOLD down at 1180 (Q2)
Crude 78.93
EURUSD 1.3051 (Q1+)
USDJPY 86.5 (Q1-)

3.  Plan
I will try again to work out of the money positions for JPY longs and enter a long EURUSD position; I will monitor EURSEK for a long if there is a retracement.

EURUSD
I will enter a long B&B on the yob level (1.2860) as retracement; I will hedge on a couple of level down (-100 pips). I can open a new toe in long same level. I will take profit at 50-100 pips
Comment:< >

USDJPY
Already too many positions (+6)
Comment:< >

AUDJPY
Already too many positions (+3)
Comment:< >

EURNOK
Hold short positions
Comment:< >

4.  Trades
4.1 open trades, their type & their value:

2 Open 13-apr-10 USDJPY L 93.2400 Q3 1:1 toe-in 86.46 -678.0000
6 Open 05-mag-10 USDJPY L 94.5900 Q2 1:1 toe-in 86.46 -813.0000
10 Open 06-mag-10 USDJPY L 93.8600 Q3 1:1 Panic 86.46 -740.0000
16 Open 14-mag-10 USDJPY L 92.3000 Q1 1:1 B&B 86.46 -485.0000
18 Open 02-giu-10 USDJPY L 92.2100 Q2 1:1 B&B 86.46 -575.0000
19 Open 30-lug-10 USDJPY L 86.3400 Q2 1:1 B&B 86.46 12.0000
6 Open 04-mag-10 AUDJPY L 86.0500 Q4 1:1 toe-in 78.17 -788.0000
7 Open 06-mag-10 AUDJPY L 85.1300 Q4 1:1 toe-in 78.17 -696.0000
17 Open 03-giu-10 AUDJPY L 78.8500 Q1- 1:1 Hedge 78.17 -68.0000

4.2 Leverage
Aggregate position size expressed as a gearing ratio (Ex = 4:1)

Total positions per currency:
USDJPY +6
EURUSD 0
AUDJPY +3
Position
USDJPY -678, -813,-740, -485, -575, 12
EURUSD 0
AUDJPY -788, -696, -68

4.3  Effect of planned trades

Account summary:
ActivTrades live account
682Starting capital: 1366
Line in the sand level:  750

1.  Account balance (Settled trades) and growth as a percentage.  (1445=5%)
2.  Account equity (Including open positions) .  (10018= -27%)
3.  Account equity if planned trades go wrong: 1000
4.  Pip distance to line in the sand level.  2518, with gear (9) 279

Daily Briefing 100726

1.  Review.

I wrote “EURUSD rally seems to be likely a short sell covering… Dirk’s views is instead bullish on EURUSD … bank stress should not cause more stress. So it looks like that the EURUSD downtrend is broken and the EURUSD bias is to be set to long”. Bank test were issued and they did not caused much stress, EURUSD is still 1.2910. US data was confirming weakness in recovery. EU data instead confirmed an unexpected strong rise in economy.
Trades
Holding the “only” -472€ at the end of the week , looking for the expected risk on increase to decrease the drawdown.

2.  Analysis.

"Fundamental analysis"
Last week was characterized again by a dollar weakness, undermined by a potential slow down in the recovery. with no really good fundamentals data. EURUSD recovery, risk currency as AUDJPY and EURNOK gained; gold din not surged despite USD loss and JPY loose a little versus the dollar too. Fed said that economy may not regain its path until 2016, calling for more QE and moving forward rate hikes expectances.

"Technical analysis"
EURUSD stayed around 1.3 levels. It would be anymore short on rallies but long positions could be taken on dips. EUR COT short decreased again (-24k), USD long are stable (+14k), showing the big divergence is finally converging and USD index is pointing to the 80 support area; JPY is now big long (+40k). USDJPY traded in the 87 area. Probably is staying down here in these dips. US futures retested the 1100 highs. AUD are little increasing (32k), showing again the end of the unwinding of the risk on positions. GOLD/Oil ratio is stalling at 15 since begging of July; but VIX is still quite volatile now at 23, pointing for a small risk off decreasing. Gold after the double top time at 1266 high is now at 1188, pointing to test the 1166 low.

"Market dynamics”
EURUSD rally seems to be likely to stay at the 1.3 levels, as median (1.25 and 1.32 levels would be the range); bank stress failed to drain out uncertainness and to be a strong reversal turnaround (UBS fail to say). It looks like that the EURUSD downtrend is broken and the EURUSD bias is to be set to long and I will enter on long on dips below the 1.3 level. No big releases this week and I will look on that as confirmation about EZ strength and US weakness. High uncertainty is still alive and short term view should be taken. JPY lost against risk currency, and USD too. I will expect a strong JPY against US; BoJ intervention is expected below 85. I will enter a very quick short trade at 88 looking to reverse for a long term long position from the 85/86 levels. Long term outlook is anyway positive for AUD and CAD. Weakness of JPY cross are more for risk off view (JPY as safe heaven) then for bad foundamentals.

Median grid
EURUSD GRID 1.250 - 1.320, (grid change), long bias
USDJPY GRID 88.00-92.00, neutral bias
AUDJPY GRID 73.00-81.00, short bias

Basically still a risk-on bias by the end of week

Prices
US up at 1100, (Q4)
GOLD down at 1188 (Q2)
Crude 78.5
EURUSD 1.2910 (Q1+)
USDJPY 87.5 (Q1-)

3.  Plan
I will try again to work out of the money positions for JPY longs (too bad);

EURUSD
I will enter a long B&B on the yob level (1.2558) as retracement; I will hedge on a couple of level down (-100 pips). I can open a new toe in long same level. I will take profit at 50-100 pips
Comment:< >

USDJPY
Already too many positions (+5)
Comment:< >

AUDJPY
Close the shorts on a dip (75)
Comment:< >

EURNOK
Hold short positions
Comment:< >

4.  Trades
4.1 open trades, their type & their value:

2 Open 13-apr-10 USDJPY L 93.2400 Q3 1:1 toe-in 87.45 -579.0000
6 Open 05-mag-10 USDJPY L 94.5900 Q2 1:1 toe-in 87.45 -714.0000
10 Open 06-mag-10 USDJPY L 93.8600 Q3 1:1 Panic 87.45 -641.0000
16 Open 14-mag-10 USDJPY L 92.3000 Q1 1:1 B&B 87.45 -485.0000

18 Open 02-giu-10 USDJPY L 92.2100 Q2 1:1 B&B 87.45 -476.0000
6 Open 04-mag-10 AUDJPY L 86.0500 Q4 1:1 toe-in 78.13 -774.0000
7 Open 06-mag-10 AUDJPY L 85.1300 Q4 1:1 toe-in 78.13 -662.0000
17 Open 03-giu-10 AUDJPY L 78.8500 Q1- 1:1 Hedge 78.13 -64.0000

4.2 Leverage

Aggregate position size expressed as a gearing ratio (Ex = 4:1)

Total positions per currency:
USDJPY +5
EURUSD 0
AUDJPY +3
Position
USDJPY -579, -714,-641, -485, -476
EURUSD 0

AUDJPY -774, -662, -64

4.3  Effect of planned trades

Account summary:
ActivTrades live account
682Starting capital: 1366
Line in the sand level:  750

1.  Account balance (Settled trades) and growth as a percentage.  (1445=5%)
2.  Account equity (Including open positions) .  (10413= -24%)
3.  Account equity if planned trades go wrong: 1000
4.  Pip distance to line in the sand level.  2913, with gear (8) 364

Daily Briefing 100718

1.  Review.

I was confident the risk-on rally was a little bit more sustained, but a strong reversal occurred at the end of the week, even for the bad data from US. Even if it is form a couple of weeks ago, I do not think anymore that EURUSD rally is only short covering, but the down trend looks like to be broken. S&P 1100 resistance hold on and AUDJPY 77.5 support was easily broken to 75.
Trades
No trades done, but the “only” -400€ at the beginning of the week is now -674€.

2.  Analysis.

"Fundamental analysis"
Last week was characterized again by a dollar weakness, undermined by a potential slow down in the recovery. with no really good fundamentals data. Manufacturing index, UoM sentiment an d unemployment data were lower than expected. TIC were low, showing that USD safe haven buying is slowing down. EURUSD recovery, but no risk currency gained the same time; gold din not surged despite USD loss and JPY gained versus the dollar too. US deficit and QE is becoming more a issue (

http://www.telegraph.co.uk/finance/currency/7893238/Feds-volte-face-sends-the-dollar-tumbling.html), alarming that a double dip recession is coming. Fed said that economy may not regain its path until 2016, calling for more QE and moving forward rate hikes expectances.

"Technical analysis"
EURUSD left historical lows and now is in the current Q1 levels range (short bias) at 1.24. It would be still short on rallies. Key support are 2006 1.18 and 2005 1.63 lows. EUR COT short decreased in a jump (-27k), USD long are decreasing (+14k), showing the big divergence is finally converging; JPY is now big long (+47k). USDJPY traded in the 88 area, breaking down in the 86 area. Probably is staying down here in these dips. US futures retested and failed to break the 1100 highs. AUD are little increasing (23k), showing again the end of the unwinding of the risk on positions. GOLD/Oil ratio is stalling at 15 since begging of July; but VIX is still quite volatile now at 26, pointing for a small risk off decreasing. Gold after the double top time at 1266 high is now at 1192, pointing to test the 1166 low.

"Market dynamics”
EURUSD rally seems to be likely a short sell covering; bank stress test expected to drain out uncertainness and to be a strong reversal turnaround (UBS). Dirk’s views is instead bullish on EURUSD (Goldman Sachs is expecting a 1.35 EURUSD and a USDJPY to 83 by the end of the year). European debt is likely to be solved (or at least there is a plan for it) and bank stress should not cause more stress. ECB is not going to do rate hikes before the Fed and the Fed is not going to do it by this year, looking to the bad economic data. So it looks like that the EURUSD downtrend is broken and the EURUSD bias is to be set to long. High uncertainty is still alive and I would not add other risk positions. JPY gained against every currency, USD too. China data were not too hot and did not added stress to the market; also the housing bubble is not going to come and government is managing carefully the issue.

Median grid
EURUSD GRID 1.220 - 1.280, long bias
USDJPY GRID 88.00-92.00, neutral bias
AUDJPY GRID 74.00-82.00, short bias

Basically still a risk-off bias by the end of week

Prices
US down at 1062, (Q2)
GOLD down at 1192 (Q2)
Crude 75.5
EURUSD 1.2930 (Q1+)
USDJPY 86.5 (Q1-)

3.  Plan
What to say: quite close to the line in the sand … I will try to work out of the money positions for JPY longs (too bad);

EURUSD
I will enter a long B&B on the yob level (1.2558) as retracement; I will hedge on a couple of level down (-100 pips). I can open a new toe in long same level. I will take profit at 50-100 pips
Comment:< >

USDJPY
Already too many positions (+5)
Comment:< >

AUDJPY
Close the shorts on a dip (75)
Comment:< >

EURNOK
Hold short positions
Comment:< >

4.  Trades
4.1 open trades, their type & their value:

2 Open 13-apr-10 USDJPY L 93.2400 Q3 1:1 toe-in 86.57 -667.0000
6 Open 05-mag-10 USDJPY L 94.5900 Q2 1:1 toe-in 86.57 -802.0000
10 Open 06-mag-10 USDJPY L 93.8600 Q3 1:1 Panic 86.57 -729.0000
16 Open 14-mag-10 USDJPY L 92.3000 Q1 1:1 B&B 86.57 -528.0000

18 Open 02-giu-10 USDJPY L 92.2100 Q2 1:1 B&B 91.4000 -520.0000
6 Open 04-mag-10 AUDJPY L 86.0500 Q4 1:1 toe-in 75.21 -1084.0000
7 Open 06-mag-10 AUDJPY L 85.1300 Q4 1:1 toe-in 75.21 -992.0000
16 Open 20-mag-10 AUDJPY S 72.8800 Q1- 1:1 Hedge 75.21 -364.0000

4.2 Leverage

Aggregate position size expressed as a gearing ratio (Ex = 4:1)

Total positions per currency:
USDJPY +5
EURUSD 0
AUDJPY +2,-1
Position
USDJPY -667, -802,-729, -528, -520
EURUSD 0

AUDJPY -1084, -992 (-364)

4.3  Effect of planned trades

Account summary:
ActivTrades live account
Starting date: 1/4/2010
Starting capital: 1366
Line in the sand level:  750

1.  Account balance (Settled trades) and growth as a percentage.  (1445=5%)
2.  Account equity (Including open positions) .  (9226= -30%)
3.  Account equity if planned trades go wrong: 1000
4.  Pip distance to line in the sand level.  1700, with gear (8) 215

Daily Briefing 100621

1.  Review.

I said “BoJ declared that they would not allow a strong yen and perhaps the pattern risk off/ strong yen will be limited, and maybe visible more on other crosses, like AUDJPY as expression of risk sentiment. I will remain short an EURUSD on medium basis, looking for sell on retracement, in the 1.23-1.24 area. High uncertainty is still alive and I would not add other risk positions” . USDJPY made some gain instead, reaching the 91 handle in the risk off sentiment at end of the week; instead AUDJPY stead at the same price level around 79. EURUSD gained the 1.24 level, worth the waiting for a new short at that level. US futures stayed falt during the end of the week.
Trades
No trades this week in Taiwan.

2.  Analysis.

"Fundamental analysis"
Last week was characterized by a dollar weakness, undermined by a potential slow down in the recovery., with tension over the Europe and no really good fundamentals data. EURUSD recovery but no risk currency gained the same time; gold surged at new all time highs and JPY gained versus the dollar too. Fundamentals were bad: low than expected ZEW, Philly Fed index, TIC was higher (US safe heaven)and still job losses. Bond auction had no problems.

"Technical analysis"
EURUSD left historical lows and now is in the current Q1 levels range (short bias) at 1.24. It would be still short on rallies. Key support are 2006 1.18 and 2005 1.63 lows. EUR COT short decreased in a jump (-602k), USD long are still there (+21k), showing the big divergence start to converge; JPY short are quite stable (-3k). USDJPY traded in the 90.2-92 area, now at 90 area. It is dangerous to a buy on these dips. US futures retested and stalled at the 1100 high. AUD long stalled (12k), showing the end of the unwinding of the risk on positions. GOLD/Oil ratio is still high from a 13 in the last months to 16; but VIX is still decreasing to 23, pointing for a small risk off decreasing. Gold made a double all time high at 1257, very quickly.

"Market dynamics”
EURUSD rally seems to be likely a short sell covering. Bank stress test expected to drain out uncertainness. Next week sentiment indicator are to be monitored and bad data could trigger a sell of the EUR again. I will be in alert of risk reverse sing as 1100 level in S&P, 1.25 in EURUSD and 77.5 in AUDJPY. High uncertainty is still alive and I would not add other risk positions.

Median grid
EURUSD GRID 1.900 - 1.250, short bias (grid change)
USDJPY GRID 88.00-92.00, neutral bias
AUDJPY GRID 74.00-82.00, short bias

Basically still a moderate risk-on bias

Prices
US down at 1100, (Q2)
GOLD up at 1250 (Q2)
Crude 77.3
EURUSD 1.24 (Q1)
USDJPY 90.7 (Q1)

3.  Plan
I will try to work out of the money positions for JPY longs;.

EURUSD
I will enter a long B&B on the next yob level (1.235); I will hedge on a couple of level down (-100 pips). I can open a new toe in long same level. I will take profit at 50-100 pips
Comment:< >

USDJPY
Already too many positions (+5)
Comment:< >

AUDJPY
Close the shorts on a dip (75)
Comment:< >

EURNOK
Hold short positions
Comment:< >

4.  Trades
4.1 open trades, their type & their value: (TODO)

2 Open 13-apr-10 USDJPY L 93.2400 Q3 1:1 toe-in 90.70 -254.0000
6 Open 05-mag-10 USDJPY L 94.5900 Q2 1:1 toe-in 90.70 -389.0000
10 Open 06-mag-10 USDJPY L 93.8600 Q3 1:1 Panic 90.70 -316.0000
16 Open 14-mag-10 USDJPY L 92.3000 Q1 1:1 B&B 90.70 -147.0000

18 Open 02-giu-10 USDJPY L 92.2100 Q2 1:1 B&B 91.4000 -151.0000
6 Open 04-mag-10 AUDJPY L 86.0500 Q4 1:1 toe-in 77.81 -700.0000
7 Open 06-mag-10 AUDJPY L 85.1300 Q4 1:1 toe-in 77.81 -609.0000
16 Open 20-mag-10 AUDJPY S 72.8800 Q1- 1:1 Hedge 77.810 -616.0000

4.2 Leverage

Aggregate position size expressed as a gearing ratio (Ex = 4:1)

Total positions per currency:
USDJPY +5
EURUSD 0
AUDJPY +2,-1
Position
USDJPY -254, -389,-316, -147, -151
EURUSD 0

AUDJPY -700, -606 (-616)

4.3  Effect of planned trades

Account summary:
ActivTrades live account
Starting date: 1/4/2010
Starting capital: 1366
Line in the sand level:  750

1.  Account balance (Settled trades) and growth as a percentage.  (1345=1.6%)
2.  Account equity (Including open positions) .  (1157= -15%)
3.  Account equity if planned trades go wrong: 1000
4.  Pip distance to line in the sand level.  4076, with gear (6) 679