Lack of time prevented me from posting last week, so here is what happened to the trades discussed on these pages. Overall, my results were mixed, even on the poor side. Nothing tragic, to be sure, but a weak period to start the month of March. Just hope that market patterns and conditions will become more compatible with my way of trading soon.
This blog goes where few traders dare – the exciting world of Forex outside the dollar!
For the past few days, global news have been dominated by events in Ukraine. So far, financial markets responded in a muted way, but that could change following escalation in tensions over the weekend. The most likely markets to become volatile are the energy sector, oil and natural gas, followed by currencies. Late last week, the Ruble and the Hryvna declined in value, but seems very few people actively trade them this fact escaped major coverage. However, the Swiss Franc responded to its safe haven status by making measured gains versus all other majors. If the situation in Ukraine turns into a shooting war, we should expect more appreciation in the CHF and most likely the US Dollar. A lot will depend on what other countries get involved in the conflict and to what extent, but the Yen could become another beneficiary, and the expense of the Euro, the Pound and most emerging currencies. The commodity currencies are as clear-cut, because the CAD, for example, could benefit from rising oil prices and yet decline on general flight to safety trend. Personally, I hope that war can be avoided and we all can concentrate on the normal traders’ headaches, such as policy meetings of central banks. There are several of them on the calendar this week, making it an extremely busy period, even without the increased uncertainty of geopolitical developments.
Several weeks ago, I was tracking the GBP-JPY on these pages, looking for sell opportunities. Results were good, but eventually, that pair started to rebound. From the long-term perspective, direction of this market is uncertain and open to interpretation. When I started to short it, my opinion was that the GBP-JPY was in the process of building a top. So far, it is still possible and, at least for now, I maintain the bearish bias, but that is subject to change depending on what happens during next several days.