Many of you have been asking for a way to better track trading results and open positions. In response to these requests and in an effort to be fully transparent, a simulated portfolio was created in June to track and mirror all recommendations and trades.
P&L Update and Overview: Many of you have been asking for a way to better track trading results and open positions. In response to these requests and in an effort to be fully transparent, a simulated portfolio was created in June to track and mirror all recommendations and trades. Below is a return on equity curve since inception on June 1, 2009, along with an open and closed position tracker. I am hopeful that this will make things easier for you all.
Additionally, please feel free to check out a full profit and loss statement since inception on June 1, 2009.
Fundys - The big news overnight has come out of the UK with Sterling getting whacked across the board following comments from BoE King who said that the central bank will look into ways to reduce the deposit rate with the intent to cap commercial bank reserves at the Bank of England. This more than offset the initial GBP bullish inflation data which came in higher than expected. BoE King also said that inflation was expected to be low for some time, this despite the higher print today. In the Eurozone, German ZEW managed to post another gain, but failed to exceed expectations which was seen weighing on the Euro somewhat. However, this did not deter the Euro from posting fresh inter-day highs on the Eur/Gbp cross. In Switzerland, industrial production was much weaker than expected, which was seen generating some fresh cross related interest in Eur/Chf. More talk on the US as a reserve currency with the Kazakh central bank saying that they would be looking to reduce their USD exposure over the longer-term, but did not foresee any massive central bank reduction of USD reserves in the near-term with no real alternative to the USD at present. Looking ahead, US retail sales (1.7% expected), PPI (0.8% expected) and empire manufacturing (14.5 expected) are all due at 12:30GMT, along with Canada new motor vehicle sales (5.0% expected). US IBD/TIPP economic optimism follows at 14:00GMT, along with business inventories (-0.8% expected). US equity futures point to a marginally lower open, while commodities are mixed.
Techs - EUR/USD With the daily RSI by 70 and the market looking stretched, we do not anticipate the current rally to extend much further before a healthy and necessary corrective pullback. Key resistance comes in by 1.4720 which represents the December 2008 spike highs and we look for a rally towards this level on Tuesday, with the market potentially just exceeding 1.4720, before the start of anticipated correction. STRATEGY: SELL @1.4725 FOR AN OPEN OBJECTIVE; STOP 1.4925. RECOMMENDATION TO BE REMOVED IF NOT TRIGGERED BY NY CLOSE (5PM ET) ON TUESDAY. USD/JPY We established a long position on Friday and have most recently moved our stops up to cost with overall price action quite choppy. However, our bias from here is for a more significant corrective bounce, with the daily studies looking to cross up from oversold after the market stalled on Friday by the 78.6% fib retracement off of the 2009 low-high. Monday's bullish hammer-like close has been followed up with some positive momentum on Tuesday and a push back towards 92.00 is seen at a minimum before even considering bearish trend resumption. GBP/USD We continue to maintain a sell on rallies approach to this market with the view that the pair has made a meaningful high above 1.7000 this year. The ensuing price action is more choppy consolidation than any threat of a fresh upside extension beyond 1.7000. Arguably, the market could even be in the process of carving the right shoulder of a head & shoulders top that ultimately would project setbacks to 1.5000 over the coming weeks. Friday's 1.6745 high is expected to cap any additional intraday rallies, while back under 1.6520 should now accelerate declines. Only a close above 1.6745 would give reason for concern. USD/CHF The market is looking extremely attractive to us at current levels with daily studies oversold and with no real reason to continue weakening after medium-term support at 1.0370 was finally taken out. A fresh 2009 low has been set on Tuesday at 1.0320 and we look for the latest bounce to open a break above 1.0425 on Tuesday to confirm bias and accelerate gains back into the 1.0500-1.700 area.
Flows - Large Eur/Usd option expiries at 1.4560; Russian accounts on the offer. US investment house on the offer in Cable. Japanese accounts selling Usd/Jpy. Real money bids in Nzd/Jpy.
Trade of the Day - Eur/Gbp: Our short trade from Monday @0.8818 was stopped at break-even after the market surged through stops above 0.8830 this morning. However, we are not entirely convinced of the current rally and will once again look to take advantage of overdone intraday moves to establish a short trade in the direction of the prevailing downtrend that has dominated trade throughout 2009. There is a confluence of resistance in the 0.8870-0.8885 area, with the June5 high, upper Bollinger and 200-Day SMA all converging. As such, any push into this zone will be welcome. STRATEGY: SELL @0.8885 FOR AN OPEN OBJECTIVE; STOP 0.9025. RECOMMENDATION TO BE REMOVED IF NOT TRIGGERED BY NY CLOSE (5PM ET) ON TUESDAY.
Written by Joel Kruger, Technical Currency Strategist for DailyFX.com
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