Away from 26Sep-06Oct09

Will have limited access to internet during this period. Current positions will be monitored and maintained but any changes made (if any) will not be reflected here. Unlikely to make any new posts here until 06Oct09.

Positions :=

1. +HGZ9 (last 273.85) : Expect test of UpTL support at 256.
2. -BPZ9 (last 1.5949) : SHS top confirmed, objective 1.5170.
3. +TYZ9/-FGBLZ9 (last 118-00.5/121.67, +8) : Non-performing, but chart in my favor.
4. -EDM0/+EDZ0 (last +75.5) : SHS top forming. NL at +73.5 not yet broken. Expect break. Target then +54.5. (see here).
5. +GCZ9 (last 992.4) : Triangle objective 1108. Expect this to be difficult trade in face of possible USD/fx rally, but this has good portfolio hedge value.
   

Benchmarks : Weekly Update

• USD Index : Downtrend intact. Watch possible test of DownTL at 77.43. Role as risk proxy complicated by non-uniform reaction vs (JPY+CHF) and vs High Yielders. Also Japanese fiscal half year closing complicating matters further.
• US10YY : Yields look top heavy to me. Even better if we can break 3.26%.
• S&P500 : Latest candle is a black one. But until TLs are broken or reversal patterns evident (so far none), it's still in an UpTrend!
• Gold : Close back below 1005.4 is disappointing but triangle still valid. Expect full or partial test of triangle support line at 972 driven by USD/fx moves.
  

S&P500 P/E ratio

• Nice chart of S&P500 PEs, courtesy of reader SWP (not of ManCity). Click to enlarge.
  
• Mean reversion towards 16x-18x ?
  

Crude Oil : Weekly UpTL being Broken

• Weekly UpTL at 67.55 being tested now.
• Many signs that Risk Appetite is being reined back eg Carry Currency reversals, Commodities weakness, lower Bond Yelds.
• For me, key is USD Index breaking its DownTL at 77.43 (see previous post) vs currently at 76.98.
  

USD/CAD : Poised to Cut Loss on Short

• Cut loss on 60% of short USD/CAD at 1.0898 last night.
• Weekly DownTL at 1.0860 is being tested.
  
• The entire short USD/CAD position has served its purpose in reducing overall P&L volatility due to the main short cable trade. Close tonight above 1.0860 = signal to cut loss on balance of short and leave Core Book slightly more naked (leaving long Gold as only counter-balance to long USD trades).
  
• This move is driven by USD strength, not so much CAD specific. USD Index, however, has not yet broken its corresponding DownTL at 77.43. Thus signal for going long USD is not yet generated.
• The short GBP/USD is outperforming due to BOTH GBP-weakness and USD-strength.
• Question of whether this is start of Risk Off : From technical (trend following) perspective, not yet. I have had enough of trying to call this early. As mentioned b4, better late and sure than early and sorry.

• Addendum 1:15 pm : Out of balance of short USD/CAD now at 1.0870.
  

ED Spread : So Close Now ...

• Cable trading now 1 big figure below its SHS top NL (confirmed break?)
  
• ED_M0/Z0 spread has traded down to +75 now. Its equivalent SHS top NL is at +73.5
• ED Spread parameters : Head +89.5; distance Head to NL 19 tics; assuming NL break at +73.5, downside objective = +54.5
• This is well worth a wild west style punt. Volatility is a lot more palatable than cable.
• FOMC yesterday "... continues to anticipate that economic conditions are likely to warrant exceptionally low levels of the federal funds rate for an extended period."
• 3 mth Libor = 0.28%; Implied EDH0 yield = 0.60% ie Spot vs 6/9 FRA yield differential = 0.32%
• ED_M0/Z0 spread = 0.75% ie positive carry on short position.
  

GBP/USD : SHS Top in Play

• Weekly SHS Top : break of NL in motion now
• Last 1.6092. Low today thus far 1.6076
• SHS parameters : Head 1.7042; distance from Head to NL = (1.7042-1.6046) = 0.0996; NL breakpoint = 1.6166; SHS top objective = (1.6166-0.0996) = 1.5170
• Added to short at 1.6161 tonight. Existing short = Foreplay. The real trade starts here, now.
• Abort if SHS pattern invalidated on weekly close.
  

Open Trades : Update

• Finally in the plus for the month. Been tough going with too many bad calls based on anticipated Risk Off and poor timing on others that were in line with ongoing chart trends.
• Short Copper : Last 277. Expect test of UpTL at 256 first.
• Short USD/CAD : Last 1.0748. 1.0630 remains trigger for further weakness but already sold at this low level so no further action.
• Short GBP/USD : Last 1.6205. SHS top remains firmly in play. This has been a very difficult trade but then, most of the good ones are. This is potentially a 10 big figure trade if we manage to break 1.6160 (weekly closing basis!).
  
• -Bunds/+UST spread : Last +8. Slow grind. Chart pointing to -20.
  
• Short ED_M0/Z0 spread : Last +80.5. As per cable, forming right shoulder. Judgment call is that this should eventually narrow to 50+. NL at +73.5.
  
• Long Gold : Last 1013.5. Triangle breakout is holding. Target at 1108 remains valid.
• Trades require enormous patience and holding power.
• USD Index + Copper losses adequately covered by Gold+Cable. All other positions are around breakeven or thereabouts.
  

USD Index : A Very Bad Miss

• Weekly line (closing only) chart of USD Index.
• Double Top around 88.41; NL at 80.90; solid downtrend since break of NL in Jun09; line chart never went back above NL after initial break.
  
• Illustrates the futility of trying to read too much into every single nuance of price action (eg candlesticks patterns, daily changes, etc). Screwed up my trading. Once mindset was wrong (ie calling equity top), all other bad trades followed. Core book was badly constructed based on early Risk Off call.
  
• Line chart of weekly close would have captured short from 80.90 to current 76.11 (-6% thus far, plentiful return for leveraged trading). Nothing more complicated required.
• Unfortunately I messed up by thinking I understood the fundamentals well enough to anticipate a turn in the trend. Unduly influenced by popular thinking and media.
• Simple is best. Charts only. No need to think too much.
  
• Double Top objective is 73.39. Another 3.5% to go.

[My trading rules (especially KISS) were evolved after long studies of charts such as this and wondering, in hindsight, why I did not capture large(r) chunks of such trends. Unfortunately, I had allowed myself to be sidetracked once again here. Most unsatisfactory.]

Mike Shedlock : When Will the Fed Start Hiking?

Blog post from Mish's Global Economic Trend Analysis here. (Anything to support shorting ED Spreads!). I like the chart from Calculated Risk re time lag between unemployment rate peak and first Fed rate hike.

Copper : Try Again

• Previous attempt to short ended badly.
• Chart looks like a topping out action.
• Trying to short again. Sold HGZ9 at 283.
  

Gold : Inflation Adjusted

• Interesting snippet from theBullionDesk.com (reproduced without permission. Click to enlarge)
• Also compares Gold vs Dow and Oil

ED Spread : Lagging Cable ?

• 1 possible interpretation of current up leg from +72.5 to +84 = the equivalent of cable from 1.6110 to 1.6742 (since then, back down to 1.6254 now)
  
• Of course, cannot rule out the worst case scenario of uptrend continuation beyond +90 but think upside will be quite limited even so. Low risk of market pricing in >100 bp of rate hikes between Jun10 and Dec10
• Current Up move = fear of FOMC surprise on hawkish side? If so, short cable will perform. If not, spread will narrow back in.
  

GBP/USD vs ED Spreads : An Observation

• Chart shows GBP/USD and ED_M0/Z0 spread across same timeframe
• Both good Risk Appetite indicators.
• Amazing how since equities made their bottom on 09Mar09, the 2 charts have an almost 1-1 structure, matching almost wave for wave in price action.
  
• Both weekly UpTL broken.
  
• Cable attempting to form SHS top now. ED Spread possibly also.
  
• But some divergence in timing in short term. Cable is down (leading) and testing NL (1.6150) whilst ED spread is retracing (up) to form right shoulder now with NL at +73.5 (lagging).
  
• 1 possible conclusion is that IF cable SHS top is confirmed and ED spread is still forming the right shoulder, 1 should go for the spread and sell it in large.
• IF ED spread is a SHS top, objective is +53.5.
  
• Cable SHS (if confirmed) downside objective 1.5154. (See here and here). Awaiting confirmation now.
  

Sterling Crosses : All Bearish GBP

• Previous post : Bearish cable
• Charts of GBP vs JPY, EUR, XAU and AUD all unequivocally bearish too, not just vs USD

GBP/USD : Potential SHS Top

• Last 1.6184
  
• Long awaited weekly SHS top coming into focus
  
• NL at appx 1.6150
• Add to shorts on confirmed break below
• SHS parameters are Head 1.7042 vs corresponding NL 1.6046 = vertical objective 0.0996. Assuming breakpoint at 1.6150, technical target = 1.5154

Michael Owen 95th minute Winner vs Man City

(click on bottom right corner icon for full screen)

Guardian report and match highlights. Initial extra time = 4 mins. Man C 90th minute goal celebrations = 56 secs. Man U substitution (Carrick for Anderson) = 30 secs. Therefore, additional time = 5 min 26 secs ie minimum 95:26. Owen goal = 95:27. So extra time not as contentious as claimed by City. Inspired timing of substitution by SAF to buy the extra time. And so good to see the long suffering and much criticised Owen showing that he still has it. There is a relevant lesson here for struggling traders (yours truly).

Procol Harum : A Whiter Shade of Pale

... A Wistful Touch of Bach ...

Benchmarks : Weekly Update

• USD index : Firmly entrenched in downtrend.
• US10YY : Crossroads, but with lower yields generally more favored.
• S&P500 : Exact reverse of USD index since US yields hit near zero and USD became a carry trade funding currency.
  
• Gold : Triangle = up. Some consolidation of recent gains reasonably expected.
• "The Trend is your Friend".
  

EUR/GBP : Up

• Late posting. Had meant to post earlier but didn't as no direct vested interest. Very nice chart in the making.
• EUR/GBP uptrend is evident. Whilst it remains so - if bearish USD (risk on) buy EUR and if bullish USD (risk off) sell GBP. Have to remember this for portfolio considerations, partial profit taking or insurance strategies, etc
  
• XAU/EUR looks up as well so consider buying XAU also instead of EUR in expressing bearish USD views.
  

10 year Bunds/UST Spread : Nearing Par

• Last at +4
• Criss-crossed +11.5 many times in past few weeks but appears ready to attack downside with some momentum now
• Prepared to add on (long UST short Bunds) if weekly chart maintains the current look into tomorrow night's close
• Don't get too excited! This is a tricky one.
  

Peter Paul & Mary : RIP Mary Travers (1936-2009)

NY Times tribute.

USD/CAD : Fresh short on break of 1.0630

• Below 1.0630 = fresh low of current down leg on all time frames.
  
• Completely missed a similar signal at 77.43 on USD Index because of wrong frame of mind, much to my regret.
• Happy to be back trading with trend instead of trying to pick turning points. No regrets if wrong now.
  

Gold : Approaching All Time High 1030.8

• Stating the obvious - buy stop in above 1030.8 = part of my game plan.
• For me - Always buy new historical high.
  

BCA Research on Gold

Posted without permission (click to enlarge).

S&P500 : Folly of Trying to Pick a Top

• Another eg of where daily chart led one astray. UpTL break at 1015 on 01Sep09 (the day after Shanghai lost 6.7%) got bears excited. Wrong!
  
• Monthly and weekly charts never did fall for it.
• One false move like this and one's mind is well and truly screwed. The whole month has been spent making up for lost opportunites. Very costly in terms of large moves missed eg weaker USD/FX. (Fortunate in that my choice of Risk Off instruments did not hurt too much).
  
• Also good eg of the folly of (1) calling tops and bottoms (2) mixing fundamentals (eg subscribing to Rosenberg) with technicals in trading.
• Best stick just to technicals and follow the trend rather than trying to anticipate turns on basis of "good story-telling". Better be late and sure than early and sorry.
  

Copper : Cut Loss

• Trade gone wrong very quickly.
• Entered based on triple top break of NL on daily.
• Original look of chart completely destroyed by current rally.
• Another eg of why I hate trading on timeframes of daily and below. Too much noise.

USD/CAD : Cut Loss 1.0706

• Stupidly picked long USD/CAD as 1 of my 2 currency pairs to express tentative early Risk Off view.
• Long 1.0806. Cut 1.0706.
• Unlike GBP/USD for which there was a good reason (see monthly charts) to try picking top, in USD/CAD there was no compelling parallel. Also was early in anticipating the weekly DownTL break.
• Should be looking to short this in line with the long term down trend. Perhaps the next pullback towards the weekly DownTL. In any case, a sell stop in below 1.0630 should be requisite minimum action for true trend followers.
  

Gold : A Different Perspective

• 1st chart (yellow background) = usual USD price of Gold
• 2nd chart (lime green b/g) = Gold priced in GBP
• Clearly very different chart structures.
• XAU/USD is whippy (lots of zig zags and overlaps). Hard to hang on to any position, especially thru'out 2008 and triangle of earlier part of this year. High volatility due to its risk appetite proxy role.
  
• XAU/GBP is a lot trendier and easier to trade. Moves are much smoother and a lot more representative of real underlying gold demand.
• Hence my preference to position in XAU/GBP. Chart looks like on the rise now.
  

Risk Aversion Indicators

Do not want to get too carried away and over-commit to RISK OFF yet. But the signs of a (risk) top are slowly showing up on various weekly charts. Here are some UpTLs being broken or about to be :=

• EUR/JPY : Now 131.97. UpTL broken at 133.08.
• US10YY : Now 3.34%. UpTL broken at 3.40%.
• Nikkei : Now 10202. UpTL just below at 10097.
• Crude Oil : Now 69.00. UpTL below at 65.85.

What we are missing now is .. downside momentum. (Note a default TL break by a sideways move with the passing of time is no good). A few large black candles should confirm a break the bulls' psychology. Until then, still cautious here. Waiting for a trigger and gritting my teeth meanwhile.

Addendum 15Sep09 9:34 pm : Had hoped that the US Retail Sales data might be a possible trigger event but it is not to be. The waiting continues.

GBP/USD : How Tops are Formed

• Just ONE possible way in which a market tops out. Stress on "ONE" of a multitude of scenarios.
• Last 1.6600
  
• Weekly : 1. UpTL (bold blue) broken at 1.6442 4 weeks ago. 2. Post-TL break low 1.6110. 3. Pullback towards TL. High of 1.6742. This coincides with the high of 1.6744 on 30Jun09. 4. The whole pattern looks like a possible SHS top in the making. NL (bold pink) now at 1.6144 this week. MUST SELL on a break here.
  
• Monthly : Possible evening star in the making. Imagine the damage to the monthly by the time the weekly breaks the NL.
• Will not be an easy trade. Expect the battle between bulls and bears to go on for a while.
  

Copper : Early Warning

• Daily chart has turned bearish. Broken triple top neckline
  
• Weekly and monthly - black candles not bullish
• Early indications of risk appetite on the wane
• Short Dec Copper now
  

Meet Joe Black

Anthony Hopkins & Claire Forlani in Meet Joe Black:=
"AH: ... I want you to get swept away out there. I want you to levitate. I want you to sing with rapture and dance like a dervish.
CF: Oh, that's all?
AH: Yeah, be deliriously happy or at least leave yourself open to be.
CF: OK. Be deliriously happy. I shall do my utmost.
AH: I know it's a cornball thing, but love is passion, obsession, someone you can't live without. Fall head over heels. Find someone you can love like crazy & who'll love you the same way back. How do you find him? Well, you forget your head and you listen to your heart. 'Cos the truth is, there's no sense living your life without this. To make the journey and not fall deeply in love...you haven't lived a life at all. But you have to try, 'cos if you haven't tried, you haven't lived."

Benchmarks : Weekly Update

• Better clarity than we have had for quite a while now = Better P&L too.
  
• USD index : Downtrend.
• US10YY : 2nd consecutive weekly test of uptrend line. Below 3.26% would be more comfortable calling for long USTs. Still, looks right to be bullish bonds now.
• S&P500 : Uptrend (but have my doubts longer term).
  
• Gold : Triangle breakout looks good. No false move so far. This is highest weekly closing ever.
  

Some Thoughts on Current Markets

Now :=

• Current price action = US Yields Down + USD fx Down + Stocks Up => US Equity rally is liquidity driven. If fundamentally driven, then rates and USD should be higher, not lower.
• Liquidity driven stock rallies, if not supported by improving fundamentals = Not sustainable in long run. Therefore, do not believe this rally will last (see Rosenberg link below), however painful it might be to be missing out. Eventually it will end in yet more tears.
• Nowhere is inflation a consideration, as indicated by Rates markets (eg ED spreads + US1oYY). Therefore, this gold rally is purely a USD move (must remember this). Deflation? Also unlikely. Must be anti-USD then.
  
• Rates markets in the driving seat [Plentiful liquidity = low yields => therefore stocks up and fx lower]. Therefore, concentrate risks on Rates to make trading less mentally challenging. Watch Rates like a hawk and do not miss its signals.
  
• Other markets are noise and obscuring the real picture.

Future :=

• If USD weakens too much, then FX will eventually take over the mantle from Rates as the driver of overall markets. Not yet.
  
• If Equities are right (to be up where they are now or higher still) and Rates wrong, there will be plenty of time to trade for interpretation convergence later. See David Rosenberg on whats priced into current equity markets.
  

ED Spreads : Lots of Room to Fall

• Now at +70
• Thus far, have only shown the weekly chart here, where support expected at +68.5. Down move from top has been smoother than expected.
• Monthly chart has look of exponential rise which is now being reversed. Below +71.5 could see accelerated decline, as is how such sharp increases usually die (eg see Sugar currently).
• This trade might have a lot more potential than I first thought. Step up risk levels?
  

Gold : Add on Break of 1007.5

• Monthly and weekly = Up. This much is clear
• Daily : High this move 1007.45. Profit taking and squeeze on weak longs down to 982 last night. Now back above 1000. Would consider this a successful test of recent new Up Trend. Bull case is made.
  
• Now : Add to longs on fresh new highs.
  

US10YY : Buy TYZ9 against 3.44% stop

• Hard time calling this recently but chart pattern finally appears ripe for a low risk reward trade now
• Back below weekly UpTL again after false break last week
• Last 3.36% vs UpTL at 3.44% (next week)
• More significant chart points below at 3.26%, 3.11% and 3.06%
• Stop on close back above 3.44%
• Instead of adding onto Bunds/UST, I think I will try going outright long TYZ9. Searching for an entry point today.
  

10 yr Bunds/UST Spread : Back in Play

• Trading back at +11 now, having been up to +20 during the week
• Originally shorted 0.8% EAR at +10, bad timing but trade idea remains alive
• Plan now to double initial risk if we close tomorrow night (week) below +10
• This should coincide with US10YY closing below 3.40% = weekly upTL = bullish TYZ9
  
• If trade works, we should easily see -10 (monthly chart) after clearing par.
  

Copper : Watch 275

• Copper is the metal that is supposed to have a PhD in Economics.
• Price action on daily chart a bit shaky of late. Watch 275 support level on the bottom. A break = indication of reducing Risk Appetite, confirming the messages of ED spreads and USTs (but not yet in FX and Equities).
  
• Weekly and monthly appears toppy to me.
• Certainly am doing it the difficult way, positioning early for Risk Off. Still, one of these days, it's going to pay off large.
• Above 297 = back to the drawing board.
  

ED Spreads : Right Shoulder ?

• Comforting to see ED spread down move intact thru recent return to Risk On.
  
• Like cable, could be forming a right shoulder of sorts now. Can't tell how high the right shoulder could go, but +81.5 appears good first guess, judging from recent price action.
  
• In any case, NL at +77.5. Must consider adding on to short position on a close below NL (=SHS top).
  
• This is a lot less whippy than other Risk Off trades out there.
  

My Special Interest

• Simsci : Buy break 326 or sell break 303 (DblTop). UpTL now at 310.
  
• USD/CAD : Remnant of Risk Off trades, being held onto on basis of hope now. Never a good reason.
  
• GBP/USD : UpTL break still valid but lacking follow thru = needs more work for emergence of a more concrete pattern (my guess = SHS) to trade off. Hold.
  
• Bunds/UST spread : Caught short near lows, false re-entry below +11.5. Nevertheless, will assume TL break valid until proven wrong. Dare not implement my original plan of adding on at +20.
  
• ED_M0Z0 : Going good. Ain't broke don't mend.
  
• Gold : Long 2x977+991. Triangle valid. Want to see levels above 1005 to be accepted by markets (ie profit taking + re-trade back above) before considering adding.
• Current trading hampered by recent prolonged lack of success. Extremely wary of pyramiding. Mentally handicapped!
  

Asian Indices Futures : Trading Volumes

Screen capture 2:25 pm Singapore time. Apart from Simsci and Nifty, pretty decent volumes all round.

And again at 5:10 pm Singapore time (Nikkei, Taiwan T+1 session already).

USD Index : Cut Loss

• Cut loss on long USD index today at 0.7768
• Last 0.7711
  
• Illustrates the dangers of anticipating intra-period breaks before they are confirmed at the closing; and lack of discipline in cutting losses swiftly
  
• Now it looks like the down trend continues ... without me
• Unable to somersault given low mental capital
• For 4th month in a row, in difficulty again just a couple of trading sessions post NFP. Fortunately, trading size has been reduced drastically. Even so, damage to confidence severe.
• Objective simply to have a small positive this month turning out to be a struggle. When it rains it absolutely pours.
  

GBP/USD : Anticipating ...

• As feared, many of the TL breaks I pointed out earlier have run into some trouble ie no follow thru
  
• TL breaks are necessary but not sufficient for profitable trading of trend changes (I guess ...)
  
• To be fair, some of the TLs had not broken yet (eg USD index + USD/CAD). Was early in positioning for a break on the basis of others taking out their respective TLs
  
• Overall risk kept small precisely for this reason. Prepared to allow plenty of leeway for adverse moves before throwing in towel on idea of Risk Off
• With respect to cable, a much more reliable trade signal would be the development of some kind of right shoulder now so that we eventually get a SHS top. NL is at 1.6124, a close below which I am prepared to step up risk substantially. Until then, trade like a mouse.
• New highs in AUD worrying though.
  

Some Asian Indices : Open Interest on Futures

Reader OKL requested for information on liquidity of various Asian index futures so I have compiled the above Open Interest table (volumes figures above are live so not useful indication of activity as I captured the screen shot when some markets just opened for trading whilst others were still not open). For longer term position takers like myself who trade in small sizes and only inactively, all of these contracts are more than adequate to meet our needs.

[In order listed above - Singapore, Taiwan, Japan, India, Hong Kong x2, China]

UK Guardian : Tracing the Collapse, Week by Week

Excellent article containing an interactive timeline of the main events of the credit crisis and accompanying articles, starting from the collapse of Lehman Brothers on 15Sep08. A must-be-bookmarked reference article.

Benchmarks : Weekly Update

• USD Index : No follow thru buying (as feared) again. DownTL resistance declines to 78.38 next week. Still looks like protracted base forming consolidation to me.
• US10YY : Again failed to follow thru and close at 3.44%, below the UpTL at 3.36%. Disappointing.
• S&P500 : Uptrend continues.
• Gold : A rare bright spot for technical traders in current market. Triangle breakout holding well (offsetting strong USD negative revals).
  

10 year Bunds/UST Spread : Short at +10

• Fresh short Bunds/long UST 10 years at +10
• Monthly DBT looks to have failed (see previous post)
• Weekly uptrend line broken at +23
• More significantly, we have re-entered the old DBT NL at +11.5
• Weekly US10YY tells same story. 3.29% low and now pulled back to the upTL at 3.36% for a buy TY signal
• Tiny risk now. Intention is to add onto trade near to +20
  

Gold : Attempting Break on Monthly

• Last 991.5
• Break of weekly triangle at 977 exhibiting encouraging upside momentum (unlike recent TL breaks in FX which seem to have fizzled out somewhat)
• Much more significant test of resistance on monthly chart going on now. Close above 990 for Sep09 would be positive
  
• Ability of gold to rally in face of recent attempted USD strength another positive
• Upcoming chart points = 1005 and 1031. Very important levels
• Weekly triangle upside objective is appx 1108. Stop out if triangle damaged by subsequent price action.
  

Softs : Grains + Sugar Down

• Corn, Soybean & Wheat charts have been bearish for some time already
• Fell asleep on the watch and not involved in down moves due to fire-fighting elsewhere
  
• Probably not too late to get short as new lows are being made on monthly chart especially corn + wheat
• Sugar exponential rise also being reversed
• Trying not to spread myself too thinly across too many positions. Will definitely want to do something in one of these when (and if) my Risk Off trades can be put on auto-pilot. Clearly not yet
• So many ideas, not enough attention span to do them justice when things go wrong, as they surely will
• Corn looks the weakest and best short to me
  

Gold : Triangle Breakout 977

• Last 978
• Weekly triangle line at 977. Attempted break out going on.
• Bullish weekly and daily candles.
• If we clear 977 convincingly, there is a more significant chart point on the monthly chart at 990. Above this, we have tide wave and ripple in sync = UP
  
• Getting interesting finally after months of waiting.
• Fresh long tonight at 977.
  

10 year Bunds/UST Spread : Huge Disappointment

• Recall monthly double bottom at -67, NL +11, objective +89
• High hopes for this trade crushed (long at +13, out at +31)
• Spread did widen to +40 max early Aug09 after NFP (less weak than expected = temporary pricing of rate hikes, subsequently completely reversed)
• Now back to +12
• Weekly now broken uptrend line, as per US10YY
• Monthly close back <+11 = move back towards negative spread
• So, instead - now Buy UST, sell Bunds?
• The best trades sometimes are failed technical breakouts because likely that many are wrong-footed and just stop losses alone could push the initial trade into deep profitability very quickly.
  

All Roads Lead to Rome : 3 down, 3 to go

• So far, in my chart montage, 3 breaks of weekly trend lines = red circles on EUR/JPY, EDM0/Z0 spread and GBP/USD
  
• Simsci, USD/CAD and US10YY about to make similar equivalent trendline breaks
• Praying that moves see follow thru and not more of the same false breaks we have had for the past few months
• Having been chopped to pieces repeatedly recently, very wary of running too big risks on this. Perhaps that's why it's finally going to work this time (fingers crossed).