Sage advice from David in a 2-for-1 deal
You can catch the previous days episodes starting here.
I’d swap turkey for this anyday
This morning I thought I would give some of my analysis/novelty views for certain pairs for experts do laugh uncontrollably at!
Over the last few weeks and months we have seen some very strong trends develop and in some cases after consolidation extend.
So lets start with JPY. We have seen, across most of the crosses huge gains, in particular the GBP and EUR and to an extent CHF. I was chatting about it last week especially GBP and we noticed a break above 163.5 and it was fresh air for approx 1000 pips! Touched 167 this morning. Technically this has much further to run but as I mentioned in a previous post, and I think others have as well, the human mind wants to believe a pullback must happen….I did…..! The EUR cross is a similar story. Surely 170 and 140 are not going to hit anytime soon are they? Don’t bet against it! When the pullback does happen it will be quite unexpected and very sharp. A good old fashioned tree shake before the upwardly mobile crosses travel.
The AUD and NZD crosses on the other hand during this rout have stayed in a range. I know this as I have been in a AUD/JPY short for nearly a month now and it has stayed in a 230ish pip range. I chopped out of it last night for 110 pips just before the RBA statement last night. Bad decision? Probably! There you see, psychology of trading playing before my eyes!
What will happen though is when the AUD has bottomed out we will see some very strong moves in both AUD and NZD crosses. I am standing by! I do find it a little strange how the AUD falls have impacted on the NZD and dragged it down. NZD economy is in pretty good shape with decent (in comparision) interest rates to attract investors. So I would expect smart money to flow into NZD then again WTFDIK!
This leads onto the AUD. Some drop. I am looking at the weekly chart on AUD/USD and the fall from April to August was ugly. A nice correction from late August to October and falling again. To me the key levels are weekly support of 0.8991 and some older supports at 0.8755. Are we going in that direction? Reading some opinions from hedge funds who are obviously very successful due to their location don’t think so!
For me and my simple analysis it looks like the weekly had a correction on the falling chart and we are back onto a continuation fall. The RBA desperately want a weaker currency but are not known unlike the Swiss to interfere with the market. Quite an interesting quandary with this pair. The other thing of course is the USD side of things. We all know what a bleeding mess that place is with regards to monetary policy and after all the above waffle will probably override everything else. I will wait on the sidelines and jump on board for the ride when it does happen. I prefer long due to USD weakness.
USD/CAD. Tried to breakout last night but got batted down from 1.06 where I took a wee short out. Seems to be held at 1.0570 right now and I will look to book those pips today. GS putting a range of 1.14 – 1.01 for 2014? Blimey, covering most extremes there boys! Like AUD dragging down the NZD it looks like the same here to an extent. I like this pair. Although it’s a paint drying type of pair I make good returns from it, not enough to buy a Range Rover but profit is profit!
Finally, my take on Brent Crude. There was a great long signal off the daily chart a few weeks ago from 105 suggesting a target of 112. Well that has just about played out. I have a short from 111.59 with a fairly loose stop and like the short side barring world war 3 breaking out or some nutter strapping a bomb to a truck and driving into an embassy somewhere in the middle east. I find it a touch worrying, price action wise, 5 or 6 times now it has bounced off 110.5 then again it has failed and equal amount of times to breakout from 111.6. Right in a range. It did a similar thing at 108.5 then broke out quite sharply. Overall though Brent is quite directionless unlike WTI which actually makes for good short term scalping rollercoaster trading!
There’s always room for dessert
In the mid nineties I backpacked around India, solo, on an Enfield 350 Bullet motorbike for a couple of years. An amazing experience which has left an indelible print on my life. I saw, met and did incredible things which one could only ever see in that country.
In Pushkar, Rajasthan I met a Swedish couple staying in the same guesthouse as myself. We got chatting and hit it off immediately. He and I had the same sense of humour. As you do when travelling, we travelled together for the next 3 months going to all sorts of places, eventually making our way down to Goa.
Back then parts of Goa was still undeveloped and still a lot of hippies about chilling. I blended in quite well! Although we had travelled around for 3 months we went our separate ways having got to Goa as they went down to Kerala before coming back to Goa for Christmas. I stayed.
For the next month I lived like the long staying hippies not doing much, contemplating the world from a hammock and enjoyed every single second of it. Oh and there were quite a few beach parties to keep one entertained all night.
They returned for Christmas, with a few good stories from their escapades in Kerala, in a beach restaurant in north Goa. You know when someone is excitedly talking to you but your eyes are glazed over as you are thinking about something else? Well that was me. Per was gabbling away and I was staring at this stunning girl walking across the beach not listening to a word. He noticed, turned around realised and went “ahhh”.
“You like her don’t you?”
Dribbling, I replied with just a slow nod. He smiled, turned around and shouted at her and her friend in Swedish to come over. My heart rate, which for the last 5 months had been plodding along quite chilled, suddenly started flapping! Firstly he knew her, secondly she was Swedish (result) and thirdly, well there wasn’t time to think of the third she was sitting in front of me.
Per introduced me to what I can only describe as the most stunning human being I have ever clapped my eyes on. I wiped the dribble from my chin and managed to say the immortal international greeting “hi”!
Anyway she was called Asa and her friend Sabina and they were also travelling around for 1 year heading off to Oz in 2 months. We chatted as a group for 45 mins or so and then went off our separate ways.
Next day Per said that he reckons she quite liked me and thought that it would be a good idea if I asked her out for dinner one night. I said yes to the idea before he finished the sentence. He then suggested that I should ask her out in Swedish as that would impress her even more. Sound like a great idea to me.
Well we were all due to meet up in a few days, so I had plenty of time to learn my first sentence in Swedish. Odd language Swedish for an Englishman to start learning.
Anyway for 2 days I practised and practised and eventually learnt the sentence with perfect pronunciation. I was feeling quite chuffed with myself for doing so.
My opportunity to practice my newly learnt Swedish to Asa by asking her out for dinner was almost upon me.
We all met up at the Primrose Cafe, a popular late evening haunt, and got a few beers in. I was stalling feeling a little nervous, worried I would forget something or get a word wrong. An elbow in my ribs told me that now was my chance, so I turned to Asa and said to her that I had something to ask her. I think she sort of knew I was going to ask something but gave me the chance to speak.
So I asked her “Din fitta lucktar fisk?”
Yes! Nailed it perfectly.
Meanwhile Per fell off his stool howling with laughter and the 3 girls staring at me with their mouth wide open. Asa looked at me and seeing that I really had no clue what was going on said “what do you think you just said?”
“Will you come out for dinner with me?” I replied. Something really wasn’t right here I was thinking.
She looked at me almost with sympathy and said quite flatly that I had not asked her out for dinner.
I had in fact just told her that her pussy smelt of fish!
My turn to have my mouth wide open. What a tit I must look right now. Per was just about recovering with tears still rolling down his face.
Asa then said to me “As you meant to ask me sincerely out for dinner, I would love to.” Jackpot!!!
Well, she ended up being my girlfriend for 3 years.
The moral of this true story? Don’t believe everything you are taught!
These are the musings of a mad chef!
Have a great day trading.
