Hope everybody had great holiday, unless you happened to be invested in Dubai real estate market. What an unusual Thanksgiving that turned out to be! Normally it is a quiet, subdued trading period, except when surprising, big time fundamental news emerge. And did they ever! As soon as “Happy Thanksgiving” post was released, it seemed that bottom dropped under USD, which plunged to new lows against most currencies, including moving under parity with Swiss Franc and multi year low against Yen. Dollar reversed a little later. This set the tone for next day, as elevated volatility takes time to dissipate.

That alone would have been enough to make Thanksgiving trading different this year. But the real news came Yesterday from Dubai. Turns out that the Persian Gulf  state might not be able to service all the loans it took to finance its real estate during last few years. Large chunk of the debt portfolio comes for refinancing and it seems that not many large financial institutions are willing to assume the risk. Dubai World, a government investment company with around $60 Billion worth of debt, has asked creditors if it can postpone forthcoming payments until May.

All kind of things happened after that. In moves reminiscent of last year’s panic, many markets sold off and currencies were no different. Yen, and to a lesser degree the Dollar, were beneficiaries. Especially JPY staged serious moves. I looked at the computer few times during the day and was very impressed with what Yen was doing, but didn’t have time to get really active. And, frankly, I didn’t have to, since orders to buy Yen and/or sell commodity currencies had already been in place. Best example is a sell in NZD-JPY, something I have been waiting for and discussed on these pages few times before.

Market broke under 63.00, triggering a sell. Original analysis was done on daily chart, but I switched the view here to 4H chart, since this trade is already closed. Things were moving fast yesterday, and when this happens, swings can reverse or “bounce” sharply. Earlier in the day I placed a take profit at 60.00, without expecting to see this level. When I “went to work”around London open, much to my surprise, it was not filled, so I closed trade manually at 60.83, for 217 pips gain. This pair, and my broker, will be discussed in more details during the weekend.

Australian Dollar also came under pressure, which was just fine with me. After following AUD-CAD for few daysand dealing with challenging trades, it was really nice to have a position that worked as intended without any adjustment or “management”. Here broker didn’t fail, take profit was filled at intended level, but it was on the books for few days now. The longer any order is in the system , the better treatment it gets because it is among the first to be executed, as long as it doesn’t expire. But that is another problem. At any rate, after initial glitches, this cross produced good trade.

Thanksgiving trading turned out much more interesting than I imagined it would. I thought highlight would be putting a trade in USD-CHF, something I had done for few years running now. It was done, but I just closed it about 20 minutes ago, while writing this this at 1.0055. It will be posted sometimes during the weekend. Besides, other trades were certainly more exciting, if little surprising. Not the direction, but timing and speed. They deserved more coverage today.

Mike K.