Greetings! I just added a new category – the Market Tavern, where free speech / chat-like articles will be included. This is one of them.
- Woody’s credit rating
Euro’s recovery on ‘good’ news (oh really?!) coming from Dublin is intraday history already and last week’s bottom at 1.3450 is back on the radar as the euro pulled back more than half of last week’s up leg. Although it is not Halloween – there’s always someone dressed in a scary suit just around the corner and will jump out of nowhere to manipulate the markets do what he knows best. Hint: such persons work for a company of which name is rhyming with the funny cartoons character above.
Did you enjoy the song above? it is called The worst day since yesterday. So here is The Worst chart since yesterday - not sure how many of you enjoy it. I know for sure that I don’t like it at all. One of the things I really dislike in trading is how things turn around by 180 degrees just because something more or less important happened (or someone just said something). But, then again, what else should happen in a market fully ruled by fear and greed? It makes sense; though we all know that in trading – everything makes sense when looking at the charts from right to left (historical data) *grin*
- the worst chart since yesterday
Today’s market reaction reminds me of a movie which I really enjoyed: The Boondock Saints. In case you missed it and you are an Action Movies fan, I highly recommend it (though be aware that the sequel is not so good as the 1st, made in `99)
Murphy: Yeah, it’s St. Patty’s Day, everyone’s Irish tonight. Why don’t you just pull up a stool and have a drink with us?
Well, Murphy – I have a feeling we’ll all feel Irish but not because of St. Patrick’s Day but rather St. Ponzi’s Day, when the Great Bailout Circus will visit other countries.
- The Great Ponzi Circus
One of the things I always suggest to others / as well to myself, again and again – is to keep in mind that this market is irrational by design, it has a very short memory and EACH day is a NEW DAY! - the more you remember about yesterday, the more biased (read: wrong / random) your trading decisions will be. So, don’t be surprised if nobody will care in a day or two that the market reaction to the Irish bailout was surprising. In 10 years since I started trading, I witnessed many important or even breath-taking events. If the NFP was THE Event few years back and it’s nothing more than a boring / few pips spike nowadays – one gets to ask “which is the killer event nowadays?”: Well – the (unexpected) rating downgrade/ (upgrade in rare cases). Not many kind of events compare to such things. It just happens and… Boom! 2-3 or 4 big figures are easily breached in a matter of hours. But the reaction to ratings are usually corrective only – so let’s see how this one turns in the next days.
Let’s take a look at the recent COT data chart
- EURUSD COT 11-22-2010
As seen above – dollar bulls are happy since 1.41-1.42 was confirmed as a tough barrier, limiting the QE2 priced-in gains. However, the whole run started in June is still technically valid and as long as the euro doesn’t break below the 1.32 region – the decline from 1.42 to current levels is corrective. I remain neutral on EUR for now and rather look at other pairs. Although I don’t like it – it’s not much I can do about, since most pairs/crosses are highly correlated.
- debt carousel (via NY Times)
Enough talking – but here are some great articles for this evening:
- Fiat Currencies in Crisis, U.S. Dollar Surpluses Conversion into Gold – The Market Oracle
- Ireland gets help but ‘stop contagion’ also key goal – The Big Picture
- The ECB may not be the friend it seems – The Irish Times
- Euro: Reacting to Ireland in the Same Manner as Greece – Green Faucet
- Ireland Becomes the 2nd Eurozone Country to Seek a Bailout – The Daily Reckoning
- Trade77, 22th Nov. Intraday – Winners Edge Trading
Good night and good luck trading in the coming days. Enjoy
