Skip navigation

Category Archives: Trades

These is where we share with you the trades that we have executed. We also track our trades for overall profit/loss reconciliation.

Trade: Bought a 1 month AUDUSD Put Option expiring 22 November 2013

I looked at the AUDUSD, felt that it is too strong given, the weak economy, structural weakness, impending inflation and poor job numbers.

I decided to BUY a 1 month Put Option on the AUDUSD, strike at the money spot of 0.9640, expiring 22 November 2013, premium of 107bps and breakeven of 0.9533.

I am looking at a 1:1 payout at 0.9425 and a possible 2.24:1 payout at 0.9293.  Let’s not forget that it was barely three weeks ago that the AUD was at 0.9280.  I believe the likely outcome would be about 1.6:1.  We’ll see.

Trade: Short GBPUSD

I was watching the screen and at about lunch time, I noticed the pound starting to slide.  I quickly looked at my charts and I noticed that the stochastics were turning down, the ichimoku; tenkan had just the kinjun from the top down, and the price trend broke through the cloud.

I confirmed it at both the 15 minute and 5 minute time frame……………looked really good, so I short the GBPUSD at 1.6230 with a SL at 1.6250.  The pound started a slow grind downwards and at about 330pm, an hour before the MPC and BOE minutes at 430pm, I decided to square the position and bought back the pound at 1.6155 for a 75bps pop!

Trade: SHORT USDJPY

I placed as SHORT USDJPY stop if bid at 98.00 when the spot rate was at 98.33.

When the weaker non farm payroll number came out the JPY strengthened to 97.87.  My order was filled at 98.00 and I squared the position at 97.90 for a trading profit of 0.10.

Trade: Short GBPUSD

Who really knows what the non farm payroll number is going to be; could be stronger or weaker.

I did three spot trades; the first one was going LONG EURUSD, going SHORT GBPUSD, and then going SHORT USDJPY.  All three trades were placed on a stop if offered or bid.

In the case of the GBPUSD, I was hedging against a possible stronger non farm payroll number, so I SHORT GBPUSD stop if bid at 1.6100 when the spot was at 1.6131.

As we all know, when the weaker non farm payroll number came out at 148K versus expectations of 180K, the USD got clobbered and the GBPUSD when up to 1.6200.

Trade: Long EURUSD

I was betting on a poor showing of the non farm payroll and so placed a LONG EURUSD stop if offered at 1.3690 when spot was trading at 1.3675.

When the weaker non farm payroll number came out,  the spot shot passed my order and my trade was executed.  I then squared my spot position at 1.3734 for a 44 bps trading profit.

Trade Update: 1 month GBPUSD Put Option expiring 18 October 2013

Markets were just see-sawing back and forth, when I was the opportunity on Friday night, actually it was already Saturday morning at about 1:30am Singapore time.

I saw on the technicals moving back up from the trough; fast and slow stochastics cutting up from below, Chikou flattening out, so I took on my gut feel and sold the option at 1.5933.

Remember our breakeven was 1.5990, that gave me a trading profit of 57bps.  You will recall that I wrote an update on October 9th and made the decision to hang on to this option trade alittle longer.  Well, the Ichimoku is telling me that this trade has run its course.  The payout wasn’t great, a meagre 0.45:1.  Let’s not forget that this option cost me 125bps in premiums.

The lesson learnt here is that the markets are getting tougher and more dangerous!  As traders, we are taking on more risks, in this case, paying more for options and the potential payout is not commensurate to the risk we are taking.  Why?  Volatility is high.

When I woke up on Saturday morning and checked what happened in the NY afternoon session and closing……….Wow!  By closing of the NY session, the Tenkan has firmly cut up the Kinjun from below, it broke through the cloud from below and also went above the 200 day MA.  So, in hindsight it was good that my gut feel prompted me to take profit on the option…………..whew!

Trade Update: 1 month put option GBPUSD expiring on 18 October 2013

You will recall that I bought another put option on the GBPUSD at the strike of 1.6115, with a breakeven of 1.5990 and premium cost of 125bps.

I really thought we were going to lose on this option as well.  Lady Luck has decided to show her beauty, the GBPUSD and the EURUSD has did an about turn southwards starting today and the current spot is now at 1.5938, so I am 52bps in the money.

Should I take profit now or wait it out alittle longer?  The political turmoil in the US surrounding the coming debt ceiling deadline on October 17th is so so unpredictable.  Should I just take profit, since, it is on the table or wait?

The 4H chart shows that the Tenkan cutting down on the Kijun, and we are now below the cloud.  The cloud is declining and so the is Chkou.  We are near the 200 day MA of 1.5873.

Decisions…………decisions………….decisions………….however, based on the technical analysis alone, I will stay with the option for alittle longer, but I am going to be following the news like a ‘hawk’.

Tonight’s FOMC minutes at 2am Singapore time and 2pm NY time, may take away support from the USD, as the Fed didn’t taper like what the markets were expecting in the last meeting.  However, if the minutes shows that the Fed is sensitized to the economy and wants to make sure it’s growing from strength to strength which is isn’t right now, then, it should be positive USD.

Trade Update: 1 week put option on the GBPUSD expiring 27 September 2013

Well, September 27th rolled around and the GBP was up up up, moving from 1.6030 to 1.6100.

You will recall that I bought a put option at the strike of 1.5915 and a breakeven of 1.5826.  The premium was 88bps.

I let the option lapse and I made a trading loss of 88bps, which is the cost of the option.

Trade Update: I month Put Option on the AUDUSD expiring 18 Oct 2013

On September 30th, I saw AUDUSD coming down to 93.00 and at the same time I felt that the floor was reached even though it pushed down to 0.9290.

I decided to sell the option and locked in the trading profits of 100bps.  Remember our entry point was 0.9500 and our option cost was 100bps which put our breakeven at 0.9400.  Essentially, it was a 1:1 payoff, though my preliminary calculations, I was betting on a 2:1 payoff, however, AUD all of a sudden became the safe haven currency because of the partial US government shutdown and also the overhanging debt ceiling deadline on October 17th.

At the same period, the EUR and GBP was rallying against the USD, which doesn’t bode well for the other put option I did on the GBPUSD.  I will give and update shortly.

Trade: 1 month Put Option AUDUSD expiring 18 October 2013

Again, I felt that the strength in the AUD was unwarranted given the state of its economy compared to the US.  However, I also respect that the AUD is a safe haven currency and also because of the positive carry trade.

However, when the Ichimoku; Tenkan cut down on the Kinjun from the top at 0.9500, I decided to Buy a Put Option for 1 month at the money spot, breakeven at 0.9400 and a premium of 100bps.