Nowler
Experienced member
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Good luck with it mate.
I've been stopped out twice going short already this past few days.
I did however just scoop 1% from it a little while ago. Saw a quick opportunity to get in and out before I sat down to watch something. I'm out now again and not entering until I have a good hard think. Might wait to see if it will test the neck line of the H&S on the 1 Day TF. More specifically, how it behaves if/when it does.
FYI: I got great returns going short on the NZD/JPY.
Been short since Thursday I believe
It's hilarious how the market is brushing off German political uncertainty. The market seems to be delusional in its assertion of Germany growth leading to Euro strength. Lets look at some facts
Core inflation rate:
Country Rate Prev
Germany 1.20 , 1.48
France 0.50 , 0.5
Italy 0.50 , 0.7
Poland 0.8 , 1
Spain 0.90 , 1.2
Portugal 1.34 , 1.31
aggregate of euro area
European Union 1.10 , 1.3
The ECB has underlined they wont stop QE until sustained growth towards their 2% target level and wont raise rates until the end of QE. So maybe i am taking a blue pill here but i see absolutely no trend in core CPI to the upside (only Portugal showing any sign of sustained growth). Nothing has changed and the ECB are diverging further with the Fed but the market seems to be hanging onto false hope. The market is underestimating the impact of Germany spinning into political crisis. They are suffering because of the disastrous implementation of the Euro and the convergence criteria.
meanwhile in the USA
Core inflation rate:
current 1.80 , 1.7
The Fed are expected to raise rates again in December (currently 91% probability) and they have discussed further hikes next year (up to 4) to reach 2.5% which is their neutral rate.
Note to self: use the market perception of the euro to your advantage and slice target price zones into multiple trades to take advantage of the exuberance of stupidity. Let them buy it up in anticipation of false hope so that you can sell again. I should have taken a 60 pip profit last night and opened up another short this morning.
Core inflation rate:
Country Rate Prev
Germany 1.20 , 1.48
France 0.50 , 0.5
Italy 0.50 , 0.7
Poland 0.8 , 1
Spain 0.90 , 1.2
Portugal 1.34 , 1.31
aggregate of euro area
European Union 1.10 , 1.3
The ECB has underlined they wont stop QE until sustained growth towards their 2% target level and wont raise rates until the end of QE. So maybe i am taking a blue pill here but i see absolutely no trend in core CPI to the upside (only Portugal showing any sign of sustained growth). Nothing has changed and the ECB are diverging further with the Fed but the market seems to be hanging onto false hope. The market is underestimating the impact of Germany spinning into political crisis. They are suffering because of the disastrous implementation of the Euro and the convergence criteria.
meanwhile in the USA
Core inflation rate:
current 1.80 , 1.7
The Fed are expected to raise rates again in December (currently 91% probability) and they have discussed further hikes next year (up to 4) to reach 2.5% which is their neutral rate.
Note to self: use the market perception of the euro to your advantage and slice target price zones into multiple trades to take advantage of the exuberance of stupidity. Let them buy it up in anticipation of false hope so that you can sell again. I should have taken a 60 pip profit last night and opened up another short this morning.
brewski1984
Senior member
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Does a weak Euro support the DAX?
They are generally negatively correlated but it isn't always the case so yes to answer your question
Not sure how the political uncertainty will affect it and they could be positively correlated. Have a look at tradingview where you can overlay euro and dax on one chart
Last edited:
on the wire:
The European Central Bank will reaffirm its policy stance at its December meeting, and rate-setters hope to put off debate on new moves until well into next year, five sources with direct knowledge of the discussion told Reuters.
I am sticking to my guns on this EURUSD trade on the basis that the fundamentals are unchanged with the fed being far more aggressive than the ecb.
The European Central Bank will reaffirm its policy stance at its December meeting, and rate-setters hope to put off debate on new moves until well into next year, five sources with direct knowledge of the discussion told Reuters.
I am sticking to my guns on this EURUSD trade on the basis that the fundamentals are unchanged with the fed being far more aggressive than the ecb.
Fed minutes
Nothing new, market seems to be rehashing on info about inflation that's been hashed before (any excuse to buy the euro even though they are far from raising rates, growth is flat, and problems with Italy and Spain). Irrational thinking rules the day onces again.
Nothing new, market seems to be rehashing on info about inflation that's been hashed before (any excuse to buy the euro even though they are far from raising rates, growth is flat, and problems with Italy and Spain). Irrational thinking rules the day onces again.
The problem is a general USD weakness across the board and is not a EUR issue per se. The market has already priced in a Dec rate hike - currently at 91.5 % probability. Yellen's speech yesterday (before FOMC) suggest that low inflation may be non transitory and may be more long lasting. Translated the market is reading a more dovish tone moving forward into 2018 and the number of hikes might be less aggressive and hence a re-pricing might be in the works.
This inflation transitory issue isnt new information. It has been discussed at length for a while now and mentioned in the last policy statement and post rate speech. Yellen basically reiterated the same information that was in the last statement, last speech, and the latest statement. Low inflation is a global problem amongst western developed economies. If you look at this week's EU data, it includes Draghi reconfirming no movement on policy until sustained inflation and at least until the end of QE (the euro zones inflation has been dropping not increasing). Today Reuters reported that the ecb is only going to address the issues again well into next year. My problem is the euro has appreciated over the last year (since January) off the back of the ecb tapering and raising rates. Well not only have they stated it is not tapering but merely a reduction in volume, they have also extended their horizon. Inflation in the EU is well behind the USA and the central bank policies are diverging. All things considered, the daily chart should at least reflect a 38% correction off the back of inaccurate market expectations of tapering and rates and the extension of the horizon.
To me, the selloff today must be clearing positions before the holiday. None of the data including the minutes have any impact that will lead to changes with future policy and certainly isn't new information. If something in the minutes presented new information then hell yeah I would be on board with the price action.
I am still learning the irrational behaviour of the market and need to address how I should deal with it. At this moment I am still bearish the euro vs the dollar over the medium term. I wish I was able to spend more time trading daily sentiment.( that's where the biggest opportunity resides)
I agree that the previous FED statement over the non transitory nature of inflation is not new but Yellen's most recent speech suggest that at least in her view is that it may be more long lasting than previously thought. Her statement as reported "Fed is not certain that low inflation is transitory, is keeping an open mind that it may be more long lasting". I think the market previously priced in 2-3 rate hikes in 2018 (from memory). The latest dovish tone might pushed the frequency or timeline further back.
You're right. I naively thought since it is blindingly obvious from the data it's longer term but it seems the market needs to be reminded of that fact. I didn't think of that angle. This has been an awesome lesson in defining the scope of the necessary thought process I need to nail down. It has also been a lesson on the scale of impact tier 1 data needs to be for directional sentiment to last several sessions. I was hoping to avoid this hold pattern for direction to take shape. Thanks for your valuable input.
For the record. When that durable goods data came out today I would have been all over shorting usdjpy. I would also have been all over usdcad over oil prices.
I need to get back to more of that but I can't because of work. It was easier trading for sure. This swing trading is going to take more work in the memory department. I think I need to know economies in more detail to really recognise when a piece of data is likely to have longer lasting sentiment. I did however nail this trade entry like I do day trading off the back of a good trading release. I would have bagged at least 30 pips off this one and more today which would have been another winning week. Instead I am now doing what I didn't want to do and hold for longer than a week and nothing else bagged.
I need to get back to more of that but I can't because of work. It was easier trading for sure. This swing trading is going to take more work in the memory department. I think I need to know economies in more detail to really recognise when a piece of data is likely to have longer lasting sentiment. I did however nail this trade entry like I do day trading off the back of a good trading release. I would have bagged at least 30 pips off this one and more today which would have been another winning week. Instead I am now doing what I didn't want to do and hold for longer than a week and nothing else bagged.
Ecb minutes
Same rhetoric as the fed. Will the euro bulls care?
"concern was again expressed about the possibility of changes in the inflation process which might lead to low inflation rates being more persistent, inter alia, owing to the degree of global slack, the effects of digitisation on retail activity and structural changes in the labour market. It was deemed important to continue monitoring the extent to which these various factors might be temporary or more lasting, and likely to be of a more structural nature."
Same rhetoric as the fed. Will the euro bulls care?
"concern was again expressed about the possibility of changes in the inflation process which might lead to low inflation rates being more persistent, inter alia, owing to the degree of global slack, the effects of digitisation on retail activity and structural changes in the labour market. It was deemed important to continue monitoring the extent to which these various factors might be temporary or more lasting, and likely to be of a more structural nature."
Trade plan 2.0
This trade plan has been designed to allow me to trade without it affecting my day job. My expectations are to consistently gain 1-5 percent a month. After a period of 1.5 to 2 years i will see if any doors have opened up professionally. I would prefer a solo gig (home office) over a professional one although it can potentially deliver a boost to my income. I figure a 500k trading account would be good to live off and still grow.
Every week begins on Sunday where i will review the tier 1 data ahead for the week. I will set alarms on my my mobile for 5 minutes before the data event. With acceptance of Friday and Saturday, each evening i will be doing research to maintain an understanding of each economy i am trading. This begins with central bank analysis and moves onto analyst articles followed by major news articles. This information cross checked with data points and trend analysis on major indicators like inflation,employment, growth , e.t.c, will form the basis of my understanding of current conditions.
Each day of the week i will be checking notes on noteworthy sentiments from previous sessions. This will be compared to the current day after which a decision will be made on which pairs to match to the upside and downside. If the data doesn't beat expectations either way then there is no trade. If there is a beat of expectations then i know exactly what to trade. The final task to do is check the chart for major zones and note anything important.
When mobile alarm goes off, scan headlines for anything of note. When data is released there is either a trade or there isn't. Get in at market if everything good and take a quick trade that can yield at least 15 pips. I will have a small price ticker to keep an eye on price on cases where the trade lasts longer than a few minutes.
The benefit this trading strategy has is limited time in the market and a strong conviction of price direction based on fundamental adjustments in market expectations. I don't want to be in the market long enough for anything to influence sentiment to my detriment.
This trade plan has been designed to allow me to trade without it affecting my day job. My expectations are to consistently gain 1-5 percent a month. After a period of 1.5 to 2 years i will see if any doors have opened up professionally. I would prefer a solo gig (home office) over a professional one although it can potentially deliver a boost to my income. I figure a 500k trading account would be good to live off and still grow.
Every week begins on Sunday where i will review the tier 1 data ahead for the week. I will set alarms on my my mobile for 5 minutes before the data event. With acceptance of Friday and Saturday, each evening i will be doing research to maintain an understanding of each economy i am trading. This begins with central bank analysis and moves onto analyst articles followed by major news articles. This information cross checked with data points and trend analysis on major indicators like inflation,employment, growth , e.t.c, will form the basis of my understanding of current conditions.
Each day of the week i will be checking notes on noteworthy sentiments from previous sessions. This will be compared to the current day after which a decision will be made on which pairs to match to the upside and downside. If the data doesn't beat expectations either way then there is no trade. If there is a beat of expectations then i know exactly what to trade. The final task to do is check the chart for major zones and note anything important.
When mobile alarm goes off, scan headlines for anything of note. When data is released there is either a trade or there isn't. Get in at market if everything good and take a quick trade that can yield at least 15 pips. I will have a small price ticker to keep an eye on price on cases where the trade lasts longer than a few minutes.
The benefit this trading strategy has is limited time in the market and a strong conviction of price direction based on fundamental adjustments in market expectations. I don't want to be in the market long enough for anything to influence sentiment to my detriment.