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.
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