Recent trading sessions were crazy.
Here’s the JPY blood bath:
USDJPY
- USDJPY daily chart 3-17-2011
AUDJPY
- AUDJPY weekly chart 3-17-2011
GBPJPY
- GBPJPY daily chart 3-17-2011
USDCHF
CHF is very interesting too
- USDCHF daily chart 3-17-2011
There are several months now since everyone and his dog ”buys the dip” at any level – and yesterday was not different (77% – 80% being long before the market crash).
Do you expect the JPY to continue rising against others or not?
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I am currently playing USD/JPY as a reversion correction UP from 78.05 but only w a maximum tp of 80.35. I'm fully prepared to cut and run too, especially if more funds are repatriated back to the yen.
Longer term – it looks like a no-brainer that the yen strengthens – with larger than ave volatility tnx to bargain hunters — and the BoJ.
Low point? Not a clue..
I guess it's time we look on the net for the first USDJPY parity calls :)
Lol! Not for quite a while (at which point Japan owns the world)
My reversion play 'worked' – bailed at 79.07 for a healthy +102, two other cable calls netted +170 total.
Wish every day could be that good. Am I disappointed that I didn't stay with the USD/JPY to my 80.35 target? NOOO! half a loaf that you know you can eat beats drawing to inside flushes every time.
BTW Cicero philosophized greatly – but today's qotd is a gem that I'd completely forgotten. tnx.
congrats for the excellent trades. I think we'll see a large weekend gap on Monday – one way or another.
cheers!
ps: my trader friend said that he had no problems with Trade Interceptor since he's using it, except for some random disconnects now and then (but that happens with any platform), but doesn't know much about the company.
Hi
What you mean: "carry trade is officially dead" ?
Regards
/Greg
carry trade is when you are long a currency with higher interest rate and short a currency with low interest rate (long AUDJPY, NZDJPY, EURJPY, ZARJPY etc): http://www.investopedia.com/terms/c/currencycarry…
After massive moves against those holding JPY shorts, like in the last days, imagine how many FX trading funds felt the pain. Such declines are leading to cascading margin calls and even trading funds going out of business.
As an investment strategy – carry trade can be considered dead, since it's not a viable and safe way to invest.
If you were Japan and you needed to import shit loads of raw materials to rebuild one half of your cities on the entire eastern coastline, I would think that you would want the USD/JPY as low as possible to afford all those expensive imports. When the SHTF later based on the fundamentals of their debt, there will be plenty of time to weaken the Yen all by itself without the need to waste all that fire power weakening something that will do the job itself. For now I would think the Japanese are happy to have the USD/JPY go down temporarily.
Do not time the bottom on this falling knife.
knife?
It's a falling chainsaw! :)
or a falling Katana Blade
Borrowing from the Europeans (creating even more government debt) to then go and buy USD, which they then have nothing else they can do with the money other than to buy more US Treasuries. Swapping one bad currency for another countries bad currency.
What are they smoking over there?
The intervention makes no sense, the yen will fall soon enough all by itself, they are just wasting the money and accumulating more useless USD holdings. At least that is how I see it.
we all know interventions never worked but provided some better entries for those guys looking to add more to their long-term positions. When things calm down, USDJPY will likely resume its free-fall. EURJPY, on the other hand, has quite a good chance to break above 115, though.