The Holy Alter Of Cntrl-P
Today is the day before Weimar Ben unleashes the next great
wave of money printing and currency debaement easing; the only question is how much?
Today’s action in EURJPY felt very much like short covering;
long pauses and very quick bursts upward. Sure, Spanish bonds rallied a little,
and Europe’s Pols talked smack all day long about how things were progressing
towards a satisfactory resolution, and for good measure even Greece looks
like a patchwork government can be formed by tomorrow. Uh huh [and now read my
post on the other blog and ask yourself if Nick is going to pay anybody].
It was the 7th day in a row locked into an inside
range; my feeling is the breakout will be rather dramatic, and tomorrow
provides the perfect scenario for that to happen. With record shorts all over
the place, I think we might see an explosion up in EURJPY [maybe the 102
handle] if Weimar Ben delivers the easing goods.
My intent is not to raise the fund NAV a few pennies at a
time, but today’s trade gave no buy signals and came within 8 pips of a sell
signal. USDJPY [the bottom part of EURJPY] had only a 23 pip range today,
making EURJPY price moves almost entirely dependent on EURUSD. Without some
kind of impetus, other than short covering, it’s very hard to maintain long
positions given the bearish sentiment in the market. Thing is, when it turns
and the short covering is over, you end up with no friends in the market to
help you get the prices you want getting out.
And, as I write, the latest rumor dujour of
Greece-and-Spain-are-saved has been denied, thus eliciting the obligatory 20
pip immediate dump in price in 1 second.
My gut feeling tomorrow is “The Bernank” will run with some
kind of shock and awe that surpasses market expectations of easing. This should
prompt a vicious dollar sell-off and stock market rally. We will see around
Noontime tomorrow.
We had one trade today that produced a few pennies from the
long side. Not what I want, but with no signals today from the algo, it’s what
we ended up with.
Ending NAV: 0.8975
Have a good day everyone.
-vegas
No comments:
Post a Comment