I didn’t post anything for a very simple reason. It was my birthday and I had some people over. Being a considerate host, I chose to keep them company rather than leave them alone. With this bunch, you want keep an eye on them…. Just kidding, great friends.
Bank of Japan cut interest rates from 0.5% to 0.3%. I see it as a largely symbolic gesture, since everybody else is doing and the cut is only 0.2%. BOJ does not have too much room to maneuver with when it comes to rates. At this level they are abysmal. Currencies showed no reaction to speak of on the news.
FED started releasing money from the bailout package. I’m not going to pour over the details of this operation, since they are available in all newspapers. There was something I found peculiar. FED is pressuring banks to immediately put this money to use, start issuing new loans. Recent reports claim an increased number of credit cards delinquencies. This indicates average credit worthiness of potential borrower is falling even more. If banks start making hasty loans to every Joe Six-pack who walks through the door, pretty soon we’ll find ourselves in another crisis. How would that be called? Post real estate bubble-bubble? FED-bubble? Or just bubble-bubble?
After great start of the week, last couple of days were sub par for me. At least in light of trades posted here.
The latest one I described was a buy in GBP-NZD.
Trade was filled at 2.8265 and was promptly stopped out at 2.8140, for a loss of 125 pips. At this time I have no plans for reentry. Failed breakout, loosing trade, moving on.
Another trade featured here was long trade in AUD-NZD.
Entry was at 1.1490. In my previous post I indicated that this trade would need quite a bit of room to “breath” and wide stop loss was needed. This is what happened. Nice spike up, followed by relatively sharp drop and a decent recovery. It was not expected to be a fast trade, given 4H time frame and recent tendencies in this pair. For now I’m holding this position.
On Sunday I’ll take a look at GBP-JPY on intermediate term chart. I’d do it now by trick-or -treaters are pounding on the door, so it’s time to dispense some candy. Happy Halloween!
Mike K.
I like your blog. Most of other trading blogs don’t really show trades but rather some vague predictions. Also, looks like you are not afraid to show loosing trades. More realistic than anything else I came across.
Thank you. Trading involves taking losses. Simple fact of life. People who claim they don’t have losses are likley not bing truthful.
Do you think there will be even more rate cuts?
Yes, there will be more cuts around the world (India just did). Both FED and BoJ are running out of room to cut any more, so it is rather unlikely.