Sails Up

Short EUR/$

Good CCI divergence on the charts.  The economic calendar shows good numbers on the GBP.  I expect a DXY pullback.  However the economic calendar lists pirate activity this week so will keep my position size 33% of normal with a wide stop.

Update:  position open, currently below the 1.185 stop-loss

Short EUR/NOK

Daily high-test and double top off the 50 ema.  I expect the GBP and USD to apply downward pressure on the Euro.  NOK is a commodity currency.  Position sizing will be halved due to correlation with EUR/$ short.

Update:  position open, currently below the 9.366 stop-loss

Update:  took a minor short on AUD/JPY at 87.3;  closed position early at +15% of required margin due to change in retail positioning.

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Sails Down

Always check the economic calendar.

All sails are down for the weekend.

Fed rhetoric is that rate hikes are not likely to happen in the relative future (relative to what exactly?).  This is the type of FedSpeak that throws an anchor around the dollar.  The dollar losing value buoyed up commodity prices resulting in higher demand for the commodity currencies (aud, cad, nok, nzd, etc…).  I will be keeping an eye out for the wave two pullback.

I always stay port-side with conservative lot sizing and wide stops when I see a pirate get-together listed on the economic calendar.

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Sails Up

Apply risk management to your alternative investments.

Short AUD/JPY

I expect the easterly winds to push down the AUD/JPY this week.  The Reserve Bank of Australia  (recent dovish rhetoric) did not hike rates recently.  Also the Chinese slowdown is putting overall downward pressure on commodity currencies.

However, I always rely on charts for navigable water, such as:

  • a weekly high-test with cci divergence
  • daily decelleration with cci divergence
  • top of a head & shoulders pattern on the daily chart

The Japenese Yen, a safe-haven (funding) currency, may rise above the AUD a bit this week to offset the expected decrease in the DXY.  I will be on the lookout for an updraft to the DXY to signal a flattening or decreasing of the Yen.

Use wide stops, in this case above JPY89.  Cap risk at a predetermined limit that does not change unless something outside of emotion justifies the change.  My target holding period is no more than 10 days, depending on the Winds.

trade closed:  stopped out at JPY89.2   risk capped at -1.9%

Short NZD/USD

High probabilility of the DXY  rebounding off 93, good probability of weekend gap in price action to fall, good CCI divergence on daily & weekly.  Conservative lot size and wide stop due to Fed meeting this week.  Stop loss set above USD00.75

trade closed:  stopped out at USD.755  risk capped at -1.1%

Read up on the Sintra Accord.

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fairweather & following seas