Arenoosh's Blog (34)

Bleeding USD

Looking at the events for Tuesday, 06 May 2014, we would have expected to see a normal, quiet trading day. Early in the morning, (for European traders) the RBA was announcing that they decided to maintain the official interest rate unchanged at 2.5%. A few new words in their statement were actually saying the same thing as the last statement said. In my opinion, from this point of view, there were no reasons to quit building long Aussie dollar positions.

If Tuesday would have been a…

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Added by Arenoosh on May 7, 2014 at 8:03am — No Comments

The Backstreet Boys of the Financial Markets

Mario Draghi, Shinzo Abe, Haruhiko Kuroda, Mark Carney and Ben Bernanke* are what I call the Backstreet Boys of the Financial Markets. *Janet Yellen is new and she did nothing ‘till now to deserve a place in this music band.

Mario Draghi

In the last 2 years, the ECB enjoyed the cheapest monetary policy, thanks to Mario Draghi’s magic words “whatever it takes”. While FED, BoE or BoJ had to print money to “save” their economies, investors bought Europe based on the safety…

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Added by Arenoosh on April 24, 2014 at 8:11pm — No Comments

How much is too much?

While most of us were enjoying the weekend, Mario Draghi – the ECB president – hold a press conference in Washington DC. The key of his statement was that a further strengthening of the euro exchange rate would require more loosening in the European Central Bank's monetary policy to keep the overall policy stance as accommodative as it is now. This is the reason for the today’s eur/usd gap.

As usual, he gave no numbers, no thresholds to guide us to understand how much is too much. "I…

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Added by Arenoosh on April 14, 2014 at 6:16am — No Comments

Show me the money !

Have you ever seen the movie “Jerry Maguire”? If you didn’t, you should! That’s a damn good movie. My favourite scene is when he is yelling in his office: “SHOW ME THE MONEY”!!!

This is…

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Added by Arenoosh on April 1, 2014 at 10:22am — 1 Comment

GBP/USD diverging from EUR/USD

In my last analysis about Gbp/Usd I was saying that the RSI on the daily chart indicates that the bulls are somehow tired. Today the cable made a new lower low and this intrigued me: why is the GBP sold? It is not only against USD but against all the other currencies. There was no surprising bad numbers lately, no dovish statements, no nothing. If you ask me, the British economy is the only one in the world that at this moment is really recovering. If the selling would have come in a general…

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Added by Arenoosh on March 18, 2014 at 10:43pm — 4 Comments

Copper's domino effect

March 11 - the day when the copper might have been the trigger for a domino game in the financial markets. The first piece dropped last week without anyone paying attention and seems like the second piece – in his way to the ground - is about to reach the third one. What seemed to be a calm week, with only a few risk events on the investor’s agenda could transform in a big storm.

Although none of the analysts could give a clear figure for how much copper is now tied up in deals, they…

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Added by Arenoosh on March 12, 2014 at 7:50am — No Comments

The Island of Stability

For more than one month, I build a strong case for shorting the euro, bringing many fundamentals to support my idea, as also some technical patterns who were suggesting that it “might work”. I, as many other traders, were waiting for Mr Draghi to pull the trigger during his press conference, yesterday. However, something really strange happened yesterday morning, six hours before the ECB press conference: the euro-bund dropped from 144.67 till 142.45. How is it possible to sell so…

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Added by Arenoosh on March 7, 2014 at 12:23pm — No Comments

Are we back to the "risk off" sentiment?

In the last few days, I tried to understand better the Crimea conflict and mostly why Putin sent his Panzers there. Asking around, I got this answer:

A Frenchman, a German and a Russian were bragging about their countries.

The Frenchman: we have modern cars. We use Renault to travel in France and the Peugeot when we go outside of France.

The German: we have modern cars too. We use Volkswagen when we travel in Germany and Mercedes when we go…

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Added by Arenoosh on March 4, 2014 at 11:02am — No Comments

Eur/Jpy technical analysis

I have to say it’s been a while since I haven’t looked at eur/jpy. I did it today though. But only because I wanted to check if the eur/usd drop from yesterday was because of a strong usd or because a weak eur, so I controlled all the eur/crosses. The conclusion was that seems there is an increasing pressure on the single currency.

Next week, on 6th of March the ECB is meeting again to discuss the monetary policies and the latest inflation numbers force the speculators to…

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Added by Arenoosh on February 27, 2014 at 3:48pm — No Comments

Eur/Usd: secondary bullish trend in main bearish trend

Before I expose my view about this pair please understand that my analyze is for long term - meaning the expectations to see the following scenario are for the next weeks and not for the next hours. For those of you having problems to establish the trend I recommend you to read the Dow's Theory  - it's the best way you can establish a trend.

According to the Dow Theory:

The market has three movements

(1) The "main movement", primary…

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Added by Arenoosh on February 20, 2014 at 11:12am — 2 Comments

Corn Futures breaks a strong resistance

On 10th of January, we had the first NFP of 2014 and everyone was focusing on those numbers missing the real news of that Friday: the US Department of Agriculture cut its estimate for US corn production and separate data showed corn stocks at a level that was less than expected. In addition, the US farmers unexpectedly reduced winter-wheat and winter-corn seeded acreage. Three days later, I wrote a wide analysis, published on my blog, about these two assets suggesting, to go long the…

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Added by Arenoosh on February 20, 2014 at 7:28am — No Comments

Cable doesn't know where it is going but it's on his way

The best way I can describe what GBP buyers are up to is to use Carl Sandburg’s words: “ I’m an idealist. I don’t know where I’m going but I’m on my way”. For those of you who don’t know who Mr Sandburg is, I will just tell you he was an American writer and poet, winner of three Pulitzer prizes.

Mark Carney, the BoE governor, revolutionized the UK’s monetary policy by introducing the forward guidance, linking it to the unemployment in the same way as FED did. Only that in the…

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Added by Arenoosh on February 14, 2014 at 9:28am — No Comments

The desire of gold is not for gold

Ralph Waldo Emerson (an American essayist, lecturer, and poet) once said: “The desire of gold is not for gold. It is for the means of freedom and benefit.” More I read these lines more I believe that Mr Emerson was a trader not an essayist :). Still, he is right about the gold: the yellow metal is not like any other commodity. Investors are not selling gold every time China is showing worse than expected manufacturing data as they are doing with copper for example but also they are not…

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Added by Arenoosh on February 11, 2014 at 10:00am — 1 Comment

RBA removed the dovish words from their statement

In the article I sent to my followers on Monday, regarding to the RBA meeting, I said that “investors will look into the statement for clues of further actions. Anything else than a dovish tone will be considered a big surprise and investors might jump into long aud/usd for short term.”

This morning at 04:30 GMT the RBA delivered their statement and also the “surprise”: if in the last few meetings they always used words like “room to cut rate”, this morning, they removed this…

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Added by Arenoosh on February 4, 2014 at 2:08pm — No Comments

Who's next?

When FED said for the first time the “taper” word – in May 2013 – the most hit economies were India and Brazil. Of course even the other emerging economies suffered too but not with the same intensity. I am sure all of you remember the 2013’s summer.

This year, on the same basis, seems to be Turkey’s and South Africa's turn. Again, – as it happened back in 2013 – the other emerging economies are suffering too but not as much as these two.
Since the FED delivered the first…
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Added by Arenoosh on January 30, 2014 at 5:22pm — 1 Comment

Black January on Wall Street ?

I usually try to anticipate what the market is up to and send my thoughts to you but this time I needed to see if Thursday’s drop in the stock market was an ordinary thing or the investors will panic and sell more the next day. Last year, the S&P500 never had a 3% drop in one single day. I don’t think we can consider this as an ordinary move.

Argentina, Peru, Turkey was the most hit emerging markets but even Mexico, South Africa or other emerging economies seen their currency…
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Added by Arenoosh on January 27, 2014 at 1:22pm — 1 Comment

Corn and wheat might beat gold and silver this year

Last week major event - the NFP - was an unexpected low reading. And more unexpected as the ADP came with just a few days earlier with a better number than the average expectations. Seems like everyone puts the bad NFP on the weather. America is frozen! For sure traders were when they saw the 74k new jobs created when they were expected to see around 200k.



When someone asks me what instruments I trade I always answer that if I see a good opportunity to make money…

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Added by Arenoosh on January 13, 2014 at 12:13pm — No Comments

The best risk/reward trade for 2014

Almost one month ago I wrote about the "Trade of the century" and for now I do not want to get back to the fundamentals that should sustain a long term sell aud/usd trade as nothing is changed but to update that idea with some new things.

First of all and the most important is the fact that a few days after I published my article, Glenn…
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Added by Arenoosh on January 3, 2014 at 1:37pm — 6 Comments

Late buyers for usd/jpy?

I remember a few weeks ago someone said: "The problem with bubbles is that if you sell stocks before the bubble bursts, you look foolish, but you also look foolish if you sell stocks after the bubble bursts." I don't remember exactly who that person was but the stock market is not the reason of this article, as I feel we have a similar situation on the Forex market. If you call now a reversal in the usd/jpy you might look foolish but also you might loose the…

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Added by Arenoosh on January 2, 2014 at 4:32pm — No Comments

EM are not enjoying cheap USD anymore - part I

I have to say that in my opinion the FOMC statement saying that FED will start from January 2014 to reduce their bond buying program with $10 billion/month is the best Christmas gifts investors could receive from a central bank. And not because of the new trading opportunities but mostly due the certainty this statement brought into the market. Starting May 2013 when Bernanke said for the first time that FED might reduce the QE3, the market was dominated by UNCERTAINTY: one day the…

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Added by Arenoosh on December 20, 2013 at 2:24pm — No Comments

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