Thailand has been in the news last few days and not because it’s a tourist destination. Political infighting spilled on the streets. The red-shirted demonstrators are supporters of ousted former Prime Minister Thaksin Shinawatra and want new elections and Abhisit’s ouster. They accuse the country’s elite – the military, judiciary and other unelected officials – of undermining democracy by interfering in politics. Civil unrest has lasted for number of days now and today it escalated into fire fights with government forces. First shooting death and few of other injuries were reported. Seems that with every passing day country is plunging deeper and deeper into chaos.
It is sad, but the reason I bring it up here is the Thai Baht, local currency. Last night I received 2 emails asking me about my views. With headlines like “Thai baht slides on political turmoil”, some traders are interested in shorting Baht. Frankly, I’m not the right person to ask, because I consider this currency “exotic” under best of conditions. I rarely trade or even analyse exotics. Under current circumstances I wouldn’t be touching it at all. During uncertain times like, illiquid currencies are becoming even more thinly traded. This means wide spreads and increased cost of trading. At the moment I find it prohibitively expensive to trade the Baht. On one of the platforms spread shows at 70 pips, on another at 100(!). This is all out ridiculous. To put it in perspective, trading range for entire month of March was about 150 pips. With this in mind, unless somebody has an outlook spanning months and reasons to believe Baht is going to move hundreds of pips, it is better left alone. Plenty of other currencies to trade.

Here is chart of USD-THB from about beginning of the year. I couldn’t possibly justify a trade here with those awful spreads available to retail traders at the moment. But that’s just my opinion.
YesterdayI suggested a straddle trade in USD-CHF. Pleased to say that Swissy didn’t let me down. The annual pattern held and this pair had a strong move.

A Buy order was executed first on a fake move. This trade was stopped out for a 50 pips loss. The sell part of my plan was triggered few hours later. I lifted 100 T/P order. being able to follow it now. Trade was closed short time ago, since I’m done for the day, at 1.1345 for a gain of 155 pips.  This little play cleared 105 pips, including the loss.
I don’t really see anything interesting on time frames suitable for this blog. This means  waiting time until some recognizable set ups develop on hourly charts. Tomorrow I’ll post my short term GBP-JPY trades for Tuesday, something that has not been done here in a long time.

Mike K.