Unless we see a remarkable turnaround this week then we are likely to see the first negative month for European equities this year, as well as the biggest monthly decline in stocks since May 2012. The sharp reaction from financial markets to even the suggestion that the current Fed stimulus program may be coming to the end of its road has prompted a sharp sell-off in not only stock markets globally, but bonds and commodity prices. This mere suggestion of stimulus withdrawal has shown how fragile the current stock market rally has been and it could be some time before markets settle down to where they should be as investors become more discerning about company fundamentals.
Looking at the Currency Market, The USD Index bounced from oversold levels near 80 on Wednesday when Bernanke delivered his Hawkish comments. The Index now trades near the 82 handle and this has seen Bearish developments for EURUSD pair and the GBPUSD pairs, Both down over 300 pips for the past 3 trading sessions. Looking at the EURUSD pair we have a cluster of daily moving averages close to the current price action and these will likely be retested soon. The 200 Day Moving Average is at 1.3065 and a break below this may point for additional losses as the fundamentals support a weaker Euro with another rate cut or more easing expected before the year end and the other issue in this pair is the likelihood of Dollar strength for the rest of the year with Quantitative easing purchases being tapered and the Dollar gaining from this development. Just as I have been typing a major U.S. Bank has issued a sell recommendation in EURUSD at an entry point of 1.3180, a stop at 1.3280 and a target of 1.28.
This has a nice risk-reward set up and looks a very solid trade.
Looking at Cable, over the past few weeks it worked similarly to the EURUSD as the USD long positions were wound down and the pair made rapid gains on the back of this. Along with this a lot of the U.K. Data has been positive of late and has supported Sterling pairs. The pair even managed to reach its 200 Day Moving Average at 1.5710 last week but could not close above it and now we trade at 1.5351. If the new governor of the Bank of England Mark Carney adopts a dovish policy which he is expected to do we may see the yearly low of 1.48 tested sometime before the year end.
Good luck in the Markets
Monday 24 June 2013
Friday 21 June 2013
TGIF
Thank God It's Friday....The global equity markets will be counting down the minutes to the closing bell in the US this evening after a long hard week of massive declines. The big decision that we had all been waiting for come and scared the markets. The idea that the FED may act on the idea of 'Tapering' the existing level of QE was the catalyst that top callers have been looking for.
We saw the drastic effects on the global markets especially in the US, again highlighting the markets dependence on central bank intervention. It is amazing to see how dependent stocks have become on the FED and in its purest form it is scary. We have seen billions wiped off the global equity market over the idea that the FED may act to reduce its current easing due to the fact that the US economy is showing signs of improvement, one may ask the question, 'If the economy is improving is this not a good thing for stocks?' and although it should be I will list a few reasons why this is not the case;
We saw the drastic effects on the global markets especially in the US, again highlighting the markets dependence on central bank intervention. It is amazing to see how dependent stocks have become on the FED and in its purest form it is scary. We have seen billions wiped off the global equity market over the idea that the FED may act to reduce its current easing due to the fact that the US economy is showing signs of improvement, one may ask the question, 'If the economy is improving is this not a good thing for stocks?' and although it should be I will list a few reasons why this is not the case;
- The recent rally that we have seen from January 2013 has been based on the level of central bank intervention rather than economic fundamentals. This is not only the case in the US, Japan has experienced drastic stock market growth based on the BOJ 75 Trillion monthly injection.
- The economic fundamentals have not shown a correlation to the extreme easing measures in place and I don't think that anything has changed since pre easing measures have been introduced.
- Markets are focused on sentiment, and sometimes irrational and illogical. In an ideal world good news should be good news and bad news should be bad news, however with the level of global bank intervention we have created a world where the opposite is in fact the case.
- It should be a good sign for the US economy that the FED are considering reducing there level of easing to support the economy. From their research they feel that the US economy is moving in a direction that it may be able to stand on its own to feet.
- We need to experience a shift from CB intervention, we need to experience a rotation from intervention to stability a situation where economies and stocks can be judged on their own performance and innovation capabilities rather than how much the FED is willing to print.
We have come a long way in a short period of time and we are beginning to see some money come off the table as institutional investors lock in some profit as they fear what the next few weeks might bring. It is important to note that markets can fall a lot quicker than they can climb. The next dilemma on the table is where to invest your money next? Where is the safe-haven? Usually investors and hedge firms would run to defensive asset classes such and Gold/Silver/Bonds but that play is no longer available.
There exists no safe-haven, we have seen the drastic fall in Gold over the last couple of months and more importantly over the last couple of days with all major technical levels breached. The bond market is in the brink of collapse and neither of these plays will be supported by the FED's plan of tapering QE. The stronger USD will make Gold relatively more expensive to global investors, and there is a solid argument to support the commodity/ emerging economy bull cycle coming to an end.
As a trader/ investor this is a time that you need to sit down and analyse your portfolio. If you have been involved in the recent equity bull cycle over the last 5 months then I do believe it may be a good opportunity to cash in on gains and wait for another buying opportunity. It is my personal belief that equity markets will recover in the short term as investors try and get there head around the fact that 'Tapering' is a positive sign for the US economy in the long run.
Happy Trading
@lowkeycapital
Thursday 20 June 2013
Taper Thursday
Last Night Ben Bernanke and the FOMC delivered their most Hawkish guidance in a long time hinting that Tapering is coming sooner rather then later and changed the threshold for Tapering of future Asset purchases. The Market expected him to maintain some what of a dovish tone in his remarks but when he talked about changing the threshold of tapering to nearer 7% from 6.5% unemployment the Dollar took off with Bonds, Equities, Metals and Commodities all going south from a stronger Dollar and the prospect of reduced liquidity in the system.
Bernanke gave guidance into reducing purchases but left the caveat that its down to data so the market will continue on in the good news is bad and vice versa approach. All eyes will be back on the Data and the Tapering Trade will be the major fundamental driver over the summer months. We feel that the moves may be overdone considering the Dollar was very oversold and their may have been a lot of short covering on short Dollar positions that traders were exiting quickly once they heard the Uber Dove Bernanke's hawkish rhetoric.
A lot of the Moves from last night are still playing out and in the Metals market and these may indicate that they are lasting and not ones to try and fade like the Currency moves. Gold hit the lowest level since 2010 this morning as the Spot USD contract traded at 1304. Major psychological levels in all base metals are approaching and moves below these could be very bearish. Copper sits at 306 approaching 300, Silver at $20.4 and Gold off the lows at $1314, all very close to breaking long term support levels and all looking very weak fundamentally as physical demand has started to dry up from a Slowing Chinese and Emerging Market growth. Some analysts last week started to call for Gold to go to $1200 per ounce in the coming weeks and they could be spot on considering leveraged funds will start to be Margin called on Long Gold positions once $1300 is broken. Expect heavy stop loss selling if this level goes.
Looking at Currencies, We mentioned last week that the CFTC positioning of EURUSD traders was more neutral then net short a few weeks ago leaving the pair open to faster declines as the currency was overbought and the Dollar oversold, however the move has been drastic from 1.34 to under the 1.32 handle in less then 12 hours. Poor European Manufacturing data has added to the sell off in this pair along with Strong U.K. data.
Yesterday's Daily candle was what we call in Technical Analysis an Outside Day reversal. This is when the High and the Low point of the day's range is greater then that of the previous day and is highly bearish. Combined with a pick up in Volume and a fundamental development it looks like we could have a medium term cap on the EURUSD price action at 1.34. The price action will undoubtedly come back to retest a cluster of Moving averages between the 1.30 and 1.31 handles. Another bearish development is the crossing of the 200 Day Moving Average underneath the 55 Day Moving Average, this generally signals additional downside in a pair and will have a lot of Euro bulls re-thinking their positions for the next few months with more easing potentially on the cards from the ECB in the form of Negative deposit rates or a narrowing of the corridor.
Bernanke gave guidance into reducing purchases but left the caveat that its down to data so the market will continue on in the good news is bad and vice versa approach. All eyes will be back on the Data and the Tapering Trade will be the major fundamental driver over the summer months. We feel that the moves may be overdone considering the Dollar was very oversold and their may have been a lot of short covering on short Dollar positions that traders were exiting quickly once they heard the Uber Dove Bernanke's hawkish rhetoric.
A lot of the Moves from last night are still playing out and in the Metals market and these may indicate that they are lasting and not ones to try and fade like the Currency moves. Gold hit the lowest level since 2010 this morning as the Spot USD contract traded at 1304. Major psychological levels in all base metals are approaching and moves below these could be very bearish. Copper sits at 306 approaching 300, Silver at $20.4 and Gold off the lows at $1314, all very close to breaking long term support levels and all looking very weak fundamentally as physical demand has started to dry up from a Slowing Chinese and Emerging Market growth. Some analysts last week started to call for Gold to go to $1200 per ounce in the coming weeks and they could be spot on considering leveraged funds will start to be Margin called on Long Gold positions once $1300 is broken. Expect heavy stop loss selling if this level goes.
Looking at Currencies, We mentioned last week that the CFTC positioning of EURUSD traders was more neutral then net short a few weeks ago leaving the pair open to faster declines as the currency was overbought and the Dollar oversold, however the move has been drastic from 1.34 to under the 1.32 handle in less then 12 hours. Poor European Manufacturing data has added to the sell off in this pair along with Strong U.K. data.
Yesterday's Daily candle was what we call in Technical Analysis an Outside Day reversal. This is when the High and the Low point of the day's range is greater then that of the previous day and is highly bearish. Combined with a pick up in Volume and a fundamental development it looks like we could have a medium term cap on the EURUSD price action at 1.34. The price action will undoubtedly come back to retest a cluster of Moving averages between the 1.30 and 1.31 handles. Another bearish development is the crossing of the 200 Day Moving Average underneath the 55 Day Moving Average, this generally signals additional downside in a pair and will have a lot of Euro bulls re-thinking their positions for the next few months with more easing potentially on the cards from the ECB in the form of Negative deposit rates or a narrowing of the corridor.
Wednesday 19 June 2013
Wicked Wednesday
Good Morning Traders
Today could mark the most important day for global equity markets as we wait to see the outcome from the two day FOMC meeting followed by the Bernanke press conference. There has been a lot of speculation over the last couple of weeks that we may see the FED deciding to cut back on its agressive monetary easing programme but lie rest assured the market activity this week alone would suggest otherwise.
Yesterday we had another aggressive move to the upside across global equity markets and it was significant that we did not see any selling pressure into the closing bell. We have all seen the aggressive level of volatility over the last couple of trading sessions with the DOW recording triple digit moves in six of its last seven trading sessions this can be directly linked to the uncertainty of the FED's decision this afternoon.
As a trader we must be aware of the equity market movement in the build up to today's meeting in order to get a good understanding of which direction we might move to. The recent rally in the equity markets highlights the fact that investors are expecting no tapering so if this decision is announced don't expect to see too big of a move as it will have been largely priced in. The danger I see is the press conference that takes place after the announcement, Bernanke will definitely be questioned in a roundabout way as to whether 'Tapering' is likely over the coming months and any commentary to suggest this will inevitably see the market give up some of its gains.
In terms of the FX market we saw the EURUSD pair breach the 1.34 handle for the first time since February and the pair now trades just below the 1.34 handle from its morning high of 1.34100. The USDJPY has lost direction and is well off its highs but is hoovering around the 95 level. As we know the BOJ have tried to weaken the JPY but the screws are beginning to come un-done and it will be interesting to see if they step in again and increase their existing easing policy of 75trillion a month.
In conclusion, we are expecting a quiet morning session, there could be a few small swings prior to the announcement and expect to see severe volatility sometimes irrational during the press conference, but we are expecting to see no change in the QE level and maybe some talk of potential tapering towards the end of this year if economic data reaffirms their decision.
Happy Trading
@lowkeycapital
Today could mark the most important day for global equity markets as we wait to see the outcome from the two day FOMC meeting followed by the Bernanke press conference. There has been a lot of speculation over the last couple of weeks that we may see the FED deciding to cut back on its agressive monetary easing programme but lie rest assured the market activity this week alone would suggest otherwise.
Yesterday we had another aggressive move to the upside across global equity markets and it was significant that we did not see any selling pressure into the closing bell. We have all seen the aggressive level of volatility over the last couple of trading sessions with the DOW recording triple digit moves in six of its last seven trading sessions this can be directly linked to the uncertainty of the FED's decision this afternoon.
As a trader we must be aware of the equity market movement in the build up to today's meeting in order to get a good understanding of which direction we might move to. The recent rally in the equity markets highlights the fact that investors are expecting no tapering so if this decision is announced don't expect to see too big of a move as it will have been largely priced in. The danger I see is the press conference that takes place after the announcement, Bernanke will definitely be questioned in a roundabout way as to whether 'Tapering' is likely over the coming months and any commentary to suggest this will inevitably see the market give up some of its gains.
In terms of the FX market we saw the EURUSD pair breach the 1.34 handle for the first time since February and the pair now trades just below the 1.34 handle from its morning high of 1.34100. The USDJPY has lost direction and is well off its highs but is hoovering around the 95 level. As we know the BOJ have tried to weaken the JPY but the screws are beginning to come un-done and it will be interesting to see if they step in again and increase their existing easing policy of 75trillion a month.
In conclusion, we are expecting a quiet morning session, there could be a few small swings prior to the announcement and expect to see severe volatility sometimes irrational during the press conference, but we are expecting to see no change in the QE level and maybe some talk of potential tapering towards the end of this year if economic data reaffirms their decision.
Happy Trading
@lowkeycapital
Tuesday 18 June 2013
Tuesday Morning Update
Good Morning,
Market nervousness about Fed tapering was perfectly illustrated late last night after a late article entitles "Fed likely to signal tapering move is close" from an FT Journalist and Fed watcher, sent US Markets into a sharp tailspin just before the close and Put some immediate strength into the USD. Once Markets had determined it was simply an opinion piece and there was nothing new in it they managed to recover enough to still close higher, but the entire sorry episode signifies how reliant on central bank stimulus markets have become. We hear an awful lot about how stocks are so cheap yet the mere prospect of slowing down the stimulus measures is enough to send markets into a tailspin. They can't be that cheap then, that investors are able to feel comfortable buying them, unless there is a Fed comfort blanket backstopping them?
With the Dry up in Volume in the Financial Markets in the past couple of trading weeks we have seen a break down in the Trend that we had observed all year and a break down in the correlation between different instruments. This could be for a number of reasons but the most likely is that the Market is at a turning point and the fundamental driver is the "Tapering talk" from the Federal Reserve. We personally do not buy into this. There is two things you can rely on in this world and that is night to turn to day and for Bernanke to be dovish. So the strategy for trading the FOMC minutes tomorrow has to be to buy Gold and sell the Dollar against a foreign currency.
We believe that the Dollar has reached an oversold level and it is setting up a number of attractive trades such as a short EURUSD position and a short Cable position. However with the Dollar likely to fall again tomorrow it is best not to enter this these positions until later in the week. EURO CFTC positions last week showed that the market is not as short as it was 3 weeks ago and this more balanced positioning will allow the Euro decline quicker on any Euro negative news or Dollar positive news. All the shorts have nearly been squeezed out as we approach 1.34 in this pair and with Analysts at Soc Gen and Bank of America calling for a decline to 1.20 before year end it could be time to adopt another speculative short position. Remember Soc Gen called a Euro short at the End of February before we saw it drop from 1.37 to 1.27 and they could be on the money again here.
Good luck in the Markets
Market nervousness about Fed tapering was perfectly illustrated late last night after a late article entitles "Fed likely to signal tapering move is close" from an FT Journalist and Fed watcher, sent US Markets into a sharp tailspin just before the close and Put some immediate strength into the USD. Once Markets had determined it was simply an opinion piece and there was nothing new in it they managed to recover enough to still close higher, but the entire sorry episode signifies how reliant on central bank stimulus markets have become. We hear an awful lot about how stocks are so cheap yet the mere prospect of slowing down the stimulus measures is enough to send markets into a tailspin. They can't be that cheap then, that investors are able to feel comfortable buying them, unless there is a Fed comfort blanket backstopping them?
With the Dry up in Volume in the Financial Markets in the past couple of trading weeks we have seen a break down in the Trend that we had observed all year and a break down in the correlation between different instruments. This could be for a number of reasons but the most likely is that the Market is at a turning point and the fundamental driver is the "Tapering talk" from the Federal Reserve. We personally do not buy into this. There is two things you can rely on in this world and that is night to turn to day and for Bernanke to be dovish. So the strategy for trading the FOMC minutes tomorrow has to be to buy Gold and sell the Dollar against a foreign currency.
We believe that the Dollar has reached an oversold level and it is setting up a number of attractive trades such as a short EURUSD position and a short Cable position. However with the Dollar likely to fall again tomorrow it is best not to enter this these positions until later in the week. EURO CFTC positions last week showed that the market is not as short as it was 3 weeks ago and this more balanced positioning will allow the Euro decline quicker on any Euro negative news or Dollar positive news. All the shorts have nearly been squeezed out as we approach 1.34 in this pair and with Analysts at Soc Gen and Bank of America calling for a decline to 1.20 before year end it could be time to adopt another speculative short position. Remember Soc Gen called a Euro short at the End of February before we saw it drop from 1.37 to 1.27 and they could be on the money again here.
Good luck in the Markets
Friday 14 June 2013
Friday Feeling
Good Morning Traders
Well we find ourselves at the end of another crazy week highlighted by extreme volatility and a lack of direction. Yesterday we saw a nice bounce from the lows and the US markets looked like they did in the opening months of the year as they moved in one way. The move yesterday was significantly important as we saw the initial loss of the 1600 level on the S&P500 and we briefly traded below 14900 on the Dow. The market changed from Risk Off to Risk On in a matter of minutes and there was no fundamental logic behind this aggressive buying.
It will be important to see how we wrap off the week, another day in the green might bring some optimism into the market and encourage a few retail investors back into the equity markets. Another significant thing that we will be keeping our eye on its $AAPL due to its significant influence on the S&P500, the stock traded briefly below the $430 level and a close below this could have caused a drag on the US equity markets. However we have noticed an inverse correlation between the pair which is unusual as a trader you would imagine that if the S&P500 was moving higher so to would $AAPL but it is not the case, they move in opposite directions. We put this down to the fact that money was in in $AAPL when the S&P500 was declining and investors, when $AAPL hit the $700 level things turned around an the $AAPL stock began to decline and the US Equity market began to rally and we saw money come out of $AAPL and move into the US equity markets. However I believe that this relationship will persist, if we do see a significant market correction we could see money move back into $AAPL.
And finally we do not expect to much volatility today the news flow is light and volume has been relatively low in the morning session so we will find our levels and wait for the setup's before entering the market.
Happy Trading
@lowkeycapital
Well we find ourselves at the end of another crazy week highlighted by extreme volatility and a lack of direction. Yesterday we saw a nice bounce from the lows and the US markets looked like they did in the opening months of the year as they moved in one way. The move yesterday was significantly important as we saw the initial loss of the 1600 level on the S&P500 and we briefly traded below 14900 on the Dow. The market changed from Risk Off to Risk On in a matter of minutes and there was no fundamental logic behind this aggressive buying.
It will be important to see how we wrap off the week, another day in the green might bring some optimism into the market and encourage a few retail investors back into the equity markets. Another significant thing that we will be keeping our eye on its $AAPL due to its significant influence on the S&P500, the stock traded briefly below the $430 level and a close below this could have caused a drag on the US equity markets. However we have noticed an inverse correlation between the pair which is unusual as a trader you would imagine that if the S&P500 was moving higher so to would $AAPL but it is not the case, they move in opposite directions. We put this down to the fact that money was in in $AAPL when the S&P500 was declining and investors, when $AAPL hit the $700 level things turned around an the $AAPL stock began to decline and the US Equity market began to rally and we saw money come out of $AAPL and move into the US equity markets. However I believe that this relationship will persist, if we do see a significant market correction we could see money move back into $AAPL.
And finally we do not expect to much volatility today the news flow is light and volume has been relatively low in the morning session so we will find our levels and wait for the setup's before entering the market.
Happy Trading
@lowkeycapital
Thursday 13 June 2013
Thursday Morning Update
The Nikkei 225 had another rough night of trade as the main Japanese index went over by 6% as Investors and traders alike lose faith in the great experiment going on in Japan. The Yen has been strengthening for the past couple of weeks and could strengthen more as it has technically broken through a lot of strong support levels and trendlines that have provided a base for its weakening throughout 2013.
The Breach of 95 in USDJPY major leaves a test of 90 very likely as the Market has stopped believing in the Japanese bet to beat deflation and to stimulate economic growth. The "Long Japan" trade (Long Nikkei, Short Yen) is being unwound quickly by Hedgefunds and this has put Global Equity and Bond Markets into Turmoil as market participants have started to questioning the effectiveness of Quantitative Easing programs around the Globe. This is a serious Red Flag warning as is the Break Down in the American Dollar, which normally gains during times of Risk off and Uncertainty in the Financial Markets. The Dollar has been breaking down heavy in the Past 2 weeks as talk of Tapering echoes around the Markets on a daily basis. Stock Market correlations have broken down as the Bond Market and the Equity markets sell off together which is a very worrying sight. Bond Yields in the States have risen to 2.25% on the 10 Year. The end of the QE program in the states should effectively strengthen the Dollar as it is reducing The Federal Reserves Balance sheet as there is less Dollars being printed and pumped into the Economy. The reason why the Dollar is in fact weakening is because the Fed is supporting the Bond Yields by buying so many each month and with the inevitable tapering of Bond purchases on the Horizon traders are positioning themselves for bond yields to increase dramatically as the Fed takes off its Economic Stabilizers.
Looking at the Euro currency, 2 weeks ago we talked about the EURUSD technically and how the Market was net short but not going down and with the lack of bad news coming out of the Eurozone and Draghi's more hawkish tone at the last ECB press conference it has caused an epic short squeeze in the pair and could see some further upside to 1.35 near term as there is still shorts to be squeezed out. Saying this however, We still believe there is a lot of Political and Economic uncertainty in the single currency and with the Dollar approaching key support at an oversold level it may not be long before we start heading south again in the pair. If this is just a Dollar correction it has set up a lot of great levels for traders to enter positions at. A short of the EURUSD pair at 1.35 with a stop loss at 1.3750 could be a very attractive swing trade with a target of 1.25 or below, as would a short of Cable at 1.57 as it approaches its 200 Day MA at 1.5710. We also believe that the Japanese Government may come out all guns blazing at their next meeting and adopt an even more aggressive easing program. With the USDJPY pair sitting at the 94 handle as I type it could set up a huge trade with Analysts still calling for 110 to 120 by Year end. These are certainly some very interesting swing trades that are starting to set up nicely but it is not time to fade the moves quite yet. The Volatility in the Nikkei and the JGB market must ease before entering a position as the Liquidity in the Market has dried up in the last few weeks and the Moves are overdone and your position could be stopped out very quickly.
Good Luck in the Markets
The Breach of 95 in USDJPY major leaves a test of 90 very likely as the Market has stopped believing in the Japanese bet to beat deflation and to stimulate economic growth. The "Long Japan" trade (Long Nikkei, Short Yen) is being unwound quickly by Hedgefunds and this has put Global Equity and Bond Markets into Turmoil as market participants have started to questioning the effectiveness of Quantitative Easing programs around the Globe. This is a serious Red Flag warning as is the Break Down in the American Dollar, which normally gains during times of Risk off and Uncertainty in the Financial Markets. The Dollar has been breaking down heavy in the Past 2 weeks as talk of Tapering echoes around the Markets on a daily basis. Stock Market correlations have broken down as the Bond Market and the Equity markets sell off together which is a very worrying sight. Bond Yields in the States have risen to 2.25% on the 10 Year. The end of the QE program in the states should effectively strengthen the Dollar as it is reducing The Federal Reserves Balance sheet as there is less Dollars being printed and pumped into the Economy. The reason why the Dollar is in fact weakening is because the Fed is supporting the Bond Yields by buying so many each month and with the inevitable tapering of Bond purchases on the Horizon traders are positioning themselves for bond yields to increase dramatically as the Fed takes off its Economic Stabilizers.
Looking at the Euro currency, 2 weeks ago we talked about the EURUSD technically and how the Market was net short but not going down and with the lack of bad news coming out of the Eurozone and Draghi's more hawkish tone at the last ECB press conference it has caused an epic short squeeze in the pair and could see some further upside to 1.35 near term as there is still shorts to be squeezed out. Saying this however, We still believe there is a lot of Political and Economic uncertainty in the single currency and with the Dollar approaching key support at an oversold level it may not be long before we start heading south again in the pair. If this is just a Dollar correction it has set up a lot of great levels for traders to enter positions at. A short of the EURUSD pair at 1.35 with a stop loss at 1.3750 could be a very attractive swing trade with a target of 1.25 or below, as would a short of Cable at 1.57 as it approaches its 200 Day MA at 1.5710. We also believe that the Japanese Government may come out all guns blazing at their next meeting and adopt an even more aggressive easing program. With the USDJPY pair sitting at the 94 handle as I type it could set up a huge trade with Analysts still calling for 110 to 120 by Year end. These are certainly some very interesting swing trades that are starting to set up nicely but it is not time to fade the moves quite yet. The Volatility in the Nikkei and the JGB market must ease before entering a position as the Liquidity in the Market has dried up in the last few weeks and the Moves are overdone and your position could be stopped out very quickly.
Good Luck in the Markets
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