FX Parameters From A Rookie

[al]

News from Italy on November 8/9 set up a great day trade for shorting eurusd. An even better shorting opportunity will come when (not if) France becomes the next domino to fall.
But medium-term, the downside for EUR is less certain. The fed does not want a too-strong USD. So as debt woes in Europe spread, strengthening the USD, the fed will likely take steps to counuter the dollar"s rise via QE3.

[al]

An EURUSD short covering rally which began 12/9/11 should keep up for another 200 or 300 pips. But 1.355 to 1.365 should be a great set up to short EURUSD. Likely 1.30 within a month, and 1.25 within 2 months.
The economic calendar should give good set for FX scalps. If the Retail Sales Tuesday at 8:30 cause SPX to rally, short USDCHF. Or if SPX responds with a slump, long USDCHF. But close the position before the 2:15 FOMC report. Then on Thursday, use the same strategy with the PPI and unemployment reports at 8:30.
Off the FX topic, looks to be a risk-on options expiry week. So writing ITM puts should bring big gains. Call writing, if done at all, should be limited to OTM calls.
Happy holidays to everyone at StockBuz!

[al]

SPX likely to stay flat Friday, beause an equity boost from any positive surprise from payroll reports would be offset by upward pressure on the US$. An equity slump from any negative surprise from payrolls would be offset by downward pressure on the US$. SPX might keep hovering near its 20dma until the December 9 news from Europe.

[al]

Bernenke sez "All I want for Christmas is a lower US$, not QE3".
QE "over there" in Europe gives Bernenke the lower US$ he wants, without the QE3 he doesn't want.
So for now let's trade and invest like it's 2009!, equities as well as forex, with the USD as our main guidepost.
If risk-on lasts 4 or 5 more weeks, it could produce a great place from which to short EURUSD in early 2012.

[StockBuz]

There didn't appear to be any negative reaction to the Fitch announcement.  It appears it's still a matter of who's the cleanest dirty shirt in the hamper at this point.

[al]

No Kos, i'm not keeping track. But i'm glad i took no positions on the risk-off trades which looked so promising until now. That lower outlook from Fitch might put enough downward pressure on the US$ to keep risk-on for the rest of the year. Keeps the fed from having to take on the unpopular task of QE3. My favorite pair for risk-on would be long AUDUSD...until the next shift in sentiment

[StockBuz]

 Al are you keeping track of your notations here and tracking performance?

[al]

Based on the 5pm fx open in australia, Monday will be a big risk-on day, with a lowwr USD and a higher SPX. Great news if yer short AUDNZD

[al]

If NZDUSD breaks below .7000, it could melt down big-time. Cable (GBPUSD) is even more intriguing. If it breaks below 1.53, 1.40 would look very likely. Just depends on whether or not the risk-off USD melt-up continues. If i tale any positions i will determine my stops at two times their 14-day ATRs. Pip pip cheerio everyone!

[StockBuz]

A monthly chart of EUR/USD with lower highs/lower lows would definitely infer the bloom is off the rose for the Euro.  Too much risk exposure with 17 countries involved in the Euro; but then again, I'm like you - a forex rookie.  I'm sticking to what makes me money; futures and equities.  Both to the short side as a weaker Euro does not support equity strength.

[al]

If banks tank again, circa just 3 short years ago, USD will replace gold as the safe haven du jour, sparking a forex bonanza for long USDXXX and/or short XXXUSD. The fed opposes a high USD, but it took them until March, 2009 to dunk the dollar. So, does a fractal---a rhyme---loom?
Before jumping in, better wait to see any first leg. 2008 charts indicate that missing the first leg would not deny us the lions' share of such a move, if it actually happens.

http://stocktwits.com/symbol/6E_F

http://stocktwits.com/symbol/EURUSD

http://www.robertsinn.com/2011/11/20/is-the-euro-ready-to-bounce/

http://www.forexyard.com/en/market-analysis/usd/