Fundamentals or is it funnymentals.

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Peterma

Well-Known Member
OK, promised a while back I would start a FA thread, so just to liven this place up a little I waited for what many in the FX world would argue that is the feast day of fundamentals - NFP.

There are even TA-only guys who are so afraid of the first Friday that they stay out of the market! - mind you I'm guessing that bit, but I've seen the posts about it being a lottery etc etc.

Hmmm... I am digging a hole here, next month I can sense the challenges, ah well, hands up, I only trade them when FA says it's ok, doesn't happen often but I had a sense today would be one of those very special days.

Spotted a TA specialist, guru, marketer, salesman, whatever, say in a webinar that the one indicator that all traders must never use is ........news - apparently people pay him for this info, along with a special secret indicator with a fancy name (it is 8/15 ema crossover), anyways I digress.

Today, I shorted Eur/Usd at 13.28 gmt - and then after the release closed a 3 day short on the S&P. Both trades using the dreaded 'do not use' tool.

The s&p did use some etf and ta analysis, but was influenced by FA the fx trade today had zero input from the charts, hadn't even a chart open, just sell at market 2 mins before NFP.

Why was it so simple? - well think about this, if you are a really smart central banker, lots of big offices, staff, computers, sizeable budget, appointed by committee, approved by the Governors, would you want to look silly before the entire market, would you say something contrary to the information on your desk?

So when you make a hawkish statement, sending the USD upward on Oct28, would you then expect a bad NFP a week later?, some might think she is stupid, but she's not that stupid.

So then why did price meander up after FOMC? - elementary my dear Watson, they call it manipulation, after all some of our banker friends left their unfilled sell orders in that gap - they spotted the likelihood of today in a flash.

Any other way a little person could see this? - yep, fx went back up, the gold traders didn't get manipulated, they just kept selling since FOMC.

Oh, the S&P thing, pretty sure that it would react as it did, increase in rates is knee jerk bad for stocks, problem was that the S&P, after a quick knee jerk down pushed on up after FOMC, I just traded that on up, Monday and new month, mutual funds into stocks, all sorts of theories, who knows, but I exited that long when the ETF's said to do so, then just shorted in the run down to today - it's all that simple :)

Lol, GG, I'm stone cold sober, well for now, but give us another look at the wee guys on the bouncing balls.

Jeronimo, I'm thinking maybe my favourite, well one of my many favourites, the Willburys?
 
5qXdiVb.jpg


how's that for bouncing balls?

TGG
 
Btw, just finished end of day chart readup - I see again a little thing that you guys seldom mention, the Mid Asian level - check out how often that level is the kick off point for the action.

Want to know why? - well I'll give you my theory anyhow, whether you like it or not.

In the olden days, the dark ages, before the age of the mobile phone, when everyone communicated by either newspapers, hand signals or the latest gizmo, there was also the infamous pager.

Now those little gizmos were an absolute must for a day trader, on his way to work he could actually get two essential pieces of info on a lcd display - the Asian high and the Asian low.

Now, there was no fibos, no calculators that could fit in your pocket, no charting, no mt4 - one simple maths calculation could be made - sell at the mid!

Anyways, draw a line on GU and EU and see :)
 
GG, that little baby is telling a big story, well actually yours isn't but it should.

There is space right at 0845, doesn't pick up again until 0790 - in reality around 60 pips of space. Likely the straddle guys didn't get filled, also a lot of bank orders not filled just above the white space right the way down 0790.

Hmmm.. so, wonder is the dreaded tool saying that likely those orders will just get pulled by the banks, after all price could never ever, in it's wildest dreams, get back up.

Then again, this is FX we are talking about.
 
Many times i stayed out when the big report/news were about to kick in and many times i saw it going in the direction i predicted it will go. It was because of fear of whipsaw. Today i was pretty sure it will drop and i sold it. Happy end of the week.
 

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Nice one Big, positive mental attitude.

There was less chance of whipsaw because the banks had already figured NFP immediately after the Fed statement, so they had completed a slow whipsaw up late Friday of last week, got all the missed orders filled from that gap nicely, I had figured they'd take until Monday or Tuesday this week, but they couldn't wait that long.
 
Enjoy Peta! :)
https://www.youtube.com/watch?v=Oy-9rHmXCmw
 
Remember the little gizmo? - there you go this morning - the little yellow line is the Mid Asian - on it's merry way up to have a look at the white space (well actually black on this chart but we'll not split hairs.)

Thanks Jeronimo, that's 45 mins of Saturday night sorted nicely :)
 

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Peterma said:
There is space right at 0845, doesn't pick up again until 0790 - in reality around 60 pips of space. Likely the straddle guys didn't get filled, also a lot of bank orders not filled just above the white space right the way down 0790.

Hmmm.. so, wonder is the dreaded tool saying that likely those orders will just get pulled by the banks, after all price could never ever, in it's wildest dreams, get back up.

Then again, this is FX we are talking about.
Click to expand...

So they managed to reach 0790, well done bankers, what took you guys so long, there is still some more and then you may sell until your bellies are full.
currently 0766 - gizmo area so let's see what their appetite is like.
 
Well that's all for today folks, just as one 'analyst' said earlier "that makes today's trading a bit of a puzzle" - he was talking of Fibre - not sure what the puzzle is, seems clear enough to me ...., stuck now in gizmo land, maybe a bite at those orders tomorrow.
 
Update:

Poor old bankers, they were indeed very hungry, once they got going they couldn't even wait until tomorrow.

One time, on another thread, I mentioned how it is sensible to use the dreaded tool (fundamentals/ news/whatever) and TA, see how mid Asian (gizmo area) acted as kick off from 18.15 to 19.00gmt (visible 15min or less), see also the next stepping stone was none other than 0790,

So what happens around 0850? - I have no idea, that's for a different day, different dollar.

Have a good weekend all.
 
Peterma said:
So what happens around 0850? - I have no idea, that's for a different day, different dollar.
Click to expand...

Today is the different day, yesterday a wise guy was taking (not here btw) about parity within a week, even GS were thinking minus 300 today - bankers bellies full, made the 0850 with ease - no more easing (pun intended).

Was it foreseeable? yep, Germany wrestled with QE before finally agreeing, were they ready to allow even more?

Not likely when you had the German, Jens Weidmann, ECB member and chief banker say this less than two weeks ago:

And we need to be aware that the longer we stay in ultra-loose monetary policy mode, the less effective this policy will become and the more the attendant risks and side-effects will come into play - take the exuberance in some financial markets and the problems faced by life insurers as examples. And we should not ignore the risk that fiscal policy could get used to the very low interest rates - leading to a situation in which consolidation efforts peter out and where monetary policy might come under pressure from governments to continue accommodation even if monetary tightening were called for.


So, surprise, surprise today - don't let anyone tell us that the Germans don't rule the roost at the ECB.

Boring stuff here, but always good to keep an eye on this guy, Ms Merkel still looks to him for economic advice.

https://www.bis.org/review/r151123e.htm
 
Hi guys, some more fundamental rubbish, just to cool things down a little since we have lost the best DJ about here.

Always right side of chart, forget what's past - while back I mentioned I've been buying the S&P (well I think I mentioned it) like one of those Christmas shoppers on a mission - buy,buy,buy.

Just broke that habit for the first time in a while, reason is I use my own idea of a market breadth indicator, probably a load of nonsense but it's great craic nonetheless.

Haven't the time to post the images, it's here, I see all the reds, same thing yesterday when I wanted to buy and couldn't because of the red lights.

Tonight amongst the sea of reds there is one large green, XLB, a defensive, then looking inside I see two companies leading that green, the rest red or weak - breadth = thin, a little profit taking in those two and down we'll go (that's the theory, let's see what happens. - price now at 2043

http://www.sectorspdr.com/sectorspdr/tools/sector-tracker


Update: now trade is looking shaky, some buying on AUD/USD, positioning on news, so XLB is feeling good, the rest still red. (mind you I wouldn't just be a buyer of Aus just now, but the market is always right - let's see what happens
 
Update to the update:

Trade has gone around in tiny circles, two options, first rely on the European indices to catch the s&p jitters tomorrow morning or secondly to wait for the NYers to come to the trough.

The second carries greater risk since I usually do that when buying, not used to being a bear, so will post whichever I decide - far better this right side of chart stuff, way more fun :)

Have set an exit at 2023 in any event, you know, just in case the Aus numbers etc.
 
Ok, Australian news was very positive, thus increasing the risk to my s&p sell imo - greater chance of some risk on, so will watch the European markets closely, I will cut the trade if there is such sentiment.

Interesting that the sector leader, by far, was xlb and then the Aus employment being very positive, seems those investors got it correct, anyways it's not easy switching sides after being a bull for so long, tend to see things from a bull's perspective constantly.
 
One other thing, when speaking about Aus and jobs, I remember a guy once posting that one way to anticipate an upcoming jobs report is to check business confidence.

Most major businesses subscribe (literally they have to pay) various representative bodies, usually relating to their main business activity. Those bodies' job is to take care of their members' interests. Part of that duty is to conduct monthly surveys, these surveys are usually very accurate and are often published before official data release.

Long story short here are the releases, made public early this week - remember that last month's jobs report was viewed as not being sustainable again this month.

http://www.media.anz.com/phoenix.zhtml?c=248677&p=irol-jobad&nyo=0

http://www.aigroup.com.au/economicindicators

http://business.nab.com.au/monthly-business-survey-november-2015-14240/

http://www.tradingeconomics.com/australia/business-confidence

Last two links are the same thing, only nice graphics and history in the second one.

I couldn't trade this long all because of an open short on the S&P - stupid rules, stupid bears, bring back the bulls :)
 
Update:

I am what I am - a bull on the S&P, I ditched the sell.

One of the things I have found very difficult to do is switch sides, I admire those that can do successfully and with ease, when I'm getting itchy about a trade I would usually drop to the 15min and many times use the 50sma for some guidance, price stayed below that for some time but then there was a push up, usually then I would be a buyer, but today I was looking for an exit, so when price came back for a second look - as the sat nav says - take the exit.

Some guys like to post winners, my S&P trade was a loser, did I learn anything?

First up do not ignore a likely dbl bottom on a hr1, secondly if selling do not sell after a push down, better to wait for a pull back, thirdly if I'm bullish then look for buys, get acclimatized to being a bear before switching.

Most likely the bears are eying sells right now, fibs etc - enjoyed the ride :)
 
Peterma said:
Most likely the bears are eying sells right now, fibs etc - enjoyed the ride :)
Click to expand...

That's it guys, the circle is now complete, seems the bears were indeed doing a little fib watching - price just hit 2049, the exit point.

The thing about that fib, pull one on the big move down yesterday, i.e yesterday's high to low - some guy used to be on here, you know that guy that Garry, Piper and Shop have all the admiration for, did he used to talk about that fib level?

Lol, just thought I'd throw that into the mix, sorry Jack, I'm not stirring, just having a laugh when I spotted that little baby setting up this evening :)
 
Hi Guys, still with the s&p.

I listed the mistakes, so now time to show how I put things right - I prefer to talk only right side, so the mention of the fib and the bears eying.
I don't use fibs per se, I just eyeball, the first pull up was the teaser, the second was the bait, that one was the key, the one that got all bulls excited and buying, but price turned at the fib.

I know that guys set limit sells at these levels and actually sell into the rise, I'm nowhere near brave enough for that, I prefer to wait, I like to see - the 50% (remember the gizmo) break, then I just go with the flow.

I had to pull the fib tool fractionally up to let you see where the sell entry is, see too the little visit back up - just to catch the few crumbs of sells left over - remember gizmo guys like me are not great with maths, we just know how to take a high and low and cut it in half.

Also I mentioned the hr1 dbl bottom, usually will break third time if the FA is behind it, and it is for a week or so until we get this massive rate hike out of the way.

That's how I acclimatize to switching direction, I don't mind a little loss, even two if needed until I get the feel of trading the opposite way.

Have a good weekend y'all
 

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