Source link:
http://news.forexlive.com/!/forexlive-european-morning-wrap-cautious-markets-again-as-the-fomc-reckoning-looms-large-20150917
Thursday, September 17, 2015
ForexLive European morning wrap: Cautious markets again as the FOMC reckoning looms large
Source link:
http://news.forexlive.com/!/forexlive-european-morning-wrap-cautious-markets-again-as-the-fomc-reckoning-looms-large-20150917
FOMC: Time for sense or more excuses?
2015-09-17 00:00 The FOMC is finally upon us so what will they give us this time?The financial world has been going FOMC crazy here's roundup of stories we've brought you recently;ANZ expect a rate hike from the FOMC ... but beware a government shutdownMitsubishi UFJ says no FOMC hike this timeCiti has 2 FX plays for trading the FOMCJPMorgan says the FOMC decision on Thursday is a coin flipRBC "holding out hope" that the Fed will hike this week. Goldmans still looking at DecemberGoldman Sachs previews the Federal Reserve decision on Sept 17Adam also picked some very good bones from the Fed minutesThe crucial question in the FOMC minutesFed Minutes leaked early: Most Fed officials said hike still not warranted by conditions approaching that pointYellen & Co have previously said they wanted to see more from the economy and have pinpointed, housing, Jobs and wages, so how have they all done since the last meeting?JobsWages/IncomesReal Average weekly earnings y/yHousingInflation is always a big topic but as highlighted by Adam's post above, may be something the Fed are willing to give a little bit of leeway to. Here's the CPI picture right up to yesterdayAnd so to the economy as a wholeThe big questions is whether the US is in a better place than it was in June and JulyOn the face of it there's been improvements but they've been steady and not spectacular. Unemployment continues to fall, wages and incomes are rising, housing is steady, Core CPI is holding up, GDP is steady. In fact, "steady" is probably the correct description for the US economy right now.Is "steady" enough for the Fed to hike rates today?Based on their recent rhetoric, no. The issue I have is that they've pulled a different 'must do better' rabbit out of the hat at the last few meetings. They are reeling out the excuses as to why they don't want to hike. That might be seen two ways;They're really not sure about the economyThey want to wait until the last possible moment before raisingAt some point they will run out of those types of excuses and repeating them will have the market thinking that they'll never hike unless things start to boom, and that's not going to happen. The market has been very patient with the Fed and it's not normally a patient creature. At some point it's going to say WTF? to constant excuses of why they're not hikingI'm on the fence as to whether they hike or hold today. As above they don't seem to be in a rush but then when will be a good time? I already think they've missed the boatWhat we do know is that each meeting that goes by without hiking the more expectant the market gets next time, and the greater the volatility is. It's a pressure valve building and if the Fed are worried about market ripples from their actions then they need to be aware of the potential monster they're creating. It's going to be messy whatever they do but markets will get over it and settle themselves down into the next trend, whatever that may be.For trading it we've got to be careful. I still think the best trade will be after a hike, unless you're already long USD into it, but even then I'd be cautious. There's a lot of people waiting for this potentially last blast in the dollar and the resulting exit could be very messy. I'm still long from my BOJ dip and have got the nice buffer I was hoping for. I've locked my profit in at 119.90 and will move that right up to 120.50 (or thereabouts) into the meeting. I'm also going to think about taking half off just so I've got some profit bankedFor trading over the meeting, that's going to depend on the details and what's said at the presser but lets look at the possible outcomes;No hike and a dovish tone will sink the dollar sharply but we know it likes to come roaring backNo hike but a hawkish tone and longs can ride the train a while longerHike and dovish on future hikes and it might be time to ride the kneejerk and then pull the parachute chordHike and hawkish on another quick hike and a jump might last a few sessionsEither way, both sides of the trade are going to be watching very carefully. Best of luck to you all and stay safeAll eyes on the old girl at the FedSource link:
http://news.forexlive.com/!/forexlive-fomc-preview-time-for-sense-or-more-excuses-20150917
China's Xi says economy resilient and has huge potential
2015-09-17 00:00 Chinese president out on state radio bigging it up for the masses plenty of room for manoeuvreChinese economy has ability to maintain long-term medium to high growth rateWe'll see about that one eh?Earlier the Chinese fin ministry announced that they will issue 3month bonds on weekly basis starting from Q4 and says bond issuance plan is to satisfy requirement for Yuan's inclusion in SDR basket Source link:
http://news.forexlive.com/!/chinas-xi-says-economy-resilient-and-has-huge-potential-20150917
Wednesday, September 16, 2015
GBPUSD rally runs out of steam
I mentioned earlier that the pound had a lot of congestion between 1.5460 and 1.5527 and we've topped out at 1.5529
GBPUSD H1 chart
At the time we were trading at 1.5422 and the trade was taking the breaks of the upper levels. The top one has been one level too far and now we're seeing some profit taking. I would like it to sit above 1.55 for the remainder of the day, to see support build but it looks like the broken 50.0 fib is doing the job well enough. Should we come back down further then the 1.5475/60 area is the strong level to watch
I warned against jumping in at the top at the time and that looks like a crap call with hindsight. The trouble is we can't trade hindsight and so we have to trade what's in front of us at the time. When I did the post we had already run nearly 100 pips up and people were willing to short it there. It's why we try to teach traders to wait for the levels and confirmation that a move is going to continue or peter out.
Sources: http://technical-analysis.forexlive.com/!/that-looks-to-be-it-for-the-pound-run-today-and-guess-where-we-topped-out-20150916
Sources: http://technical-analysis.forexlive.com/!/that-looks-to-be-it-for-the-pound-run-today-and-guess-where-we-topped-out-20150916
“Be neither a conformist or a rebel, for they are really the same thing. Find your own path, and stay on it.” -Paul Vixie
When’s the last time you jumped of a cliff because everybody else was doing it?
Okay, bad example.
Have you ever joined an endless line of people in the super market checkout line ready to pay, and waited 20 minutes before realizing there was another open register right beside you?
No?
How about this one…You patiently wait outside with a large crowd of people to get into the door at a movie or bar when someone dashes right in with no second thought.
The door was open the entire time!
Nobody ever approached the door to see if it was unlocked! You just assumed it was locked. You simply followed the crowd and didn’t take the initiative to check for yourself because of feeling embarrassed if you were wrong.
Your reactions, or lack of, illustrate conformity. You care too much about your “image” and what others think of you. Stepping out of your comfort zone is too much for you to handle. You think that being like the majority is safe and out of harm’s way.
Take a risk? No way, it scares the heebie-jeebies out of you.
You’re afraid to take even a small, sensible risk for fear of the negative consequences. You lack initiative.
You’re afraid to take even a small, sensible risk for fear of the negative consequences. You lack initiative.
Does this sound like you?
If so, don’t worry. The previous traits describe how a large majority of traders respond to the turbulent ups and downs of the forex market.
So why do traders conform?
For one, your everyday-conformists always concern themselves a great deal with self-appearance. They are definitely interested in looking good. Wanting to make the right impression is something that was instilled at childhood.
Conformity is so encompassing that these people always worry about displaying the “right” impression even when it’s not needed. To save embarrassment, they might hold onto a losing trade. And they may not want to try anything original or even pioneering, given the possibility of coming off as a fool when explaining things to friends.
But what does it really matter what anyone else thinks?
If you have problems with this, look deep inside yourself for direction on what you really want to do. Never let anyone else’s thoughts or feelings decide your path.
Two, traders also conform because they fear taking risks. Behind this fear usually lies the shame of losing and being a failure. And these conformists have to be right.
How do you help yourself?
Realize that failure IS to be expected.
It happens to everyone.
Many successful business people will tell you they had more failures than successes, but that it was the lessons that they learned from their failures that played a larger role in eventually attaining success.
Winning forex traders learn from failure, don’t care if they look bad and aren’t afraid to take risks.
Now, there’s a difference between moving outside of the lines gradually and totally throwing caution to the wind by gambling your money away like a mad man (or woman or cow).
A winning trader takes risks but protects herself with proper risk management. In time you’ll learn how far outside the lines you can travel comfortably and when it’s time to come back. You’ll be trading like a winner… in your own way and on your own path.
Read more: http://www.babypips.com/blogs/pipsychology/forex-risk-20150914.html#ixzz3lumeAo6y
Gains extend to 180 pips today
Gains extend to 180 pips today
Carney and the gang are continue to testify in Parliament and the overall tone is upbeat on the economy inflation despite the recent market turbulence.
The pound is soaring and has cut through the 50% retracement of the August decline and now through the 100-day moving average. The next level to watch is 1.5569, which is the 61.8% retracement of the Aug drop.
UK labour data may be enough to see more MPC members voting for hikes at next meeting
2015-09-16 00:00 UK labour data will keep the domestic economy on the right track and the BOE hawks happyToday's data is great news for the UK. The jobs market remains strong and the wage data is as good a sign of that as anyLike everyone else the UK faces export weakness in the current global market and that has been the main driver for weaker sector data from the UK. When we were recovering back in 2013 both the domestic an international parts of the economy were recovering together. The domestic art was always the stronger but it all went into the pot. Now we're finding it tough to sell abroad and we're seeing the effect of that in the dataThis data today will go along way to underpinning the economy on the domestic front. In real terms that's the only part the BOE has any control over. If the UK remains strong domestically then the BOE will be able to hike rates. Because of these two parts to our economy it means that even further falls in the main data numbers won't necessarily add weight to the no-cut arguments. The distinction will have to be made whether any weakness is caused by domestic or international influencesIt means we have to delve into the data a little deeper now to find the clues. The wider market may trade the normal 'Bad data = lower rate hike chances' but the reality may be quite differentThe data today reduces my worries that the UK will see a big slowdown and that we're probably just going to see a consolidation phase in the data and economyFor the BOE, the data today should embolden the MPC to keep on their projected path for rates and it may even be enough to see a few more members jumping across to the hike side of the road at the next MPC meetingFor the pound. It's too early to tell but I wouldn't be surprised if we start to see more support coming in now. If we look like basing then any hawkish FOMC news that sinks the pound will be a good dip buying opportunityUK wages on the up
Source link:
http://news.forexlive.com/!/uk-labour-data-will-keep-the-domestic-economy-on-the-right-track-20150916
Subscribe to:
Posts (Atom)
