We short GBPJPY at 150.80 and squared the position at 150.20 for a trading profit of 60bps0.40%
Category Archives: Trades
This morning we saw a beautiful set up on the technicals to short EURJPY and we did at 129.
We squared the position at 127.90 for a 1.1bps or 0.86% trading profit. The current spot has recovered slightly to 128.22.
We were swindled by the market last Thursday and Friday.
Data out from Australia was weak; employment weaker, unemployment higher.
PM Gillard commented that there was room for RBA to lower rates.
All these is suppose to put pressure on the AUD, but it didn’t, instead it powered all the way up to 1.0582. We believe it’s because the direct AUDCNY started on Thursday and we were just fighting the flows.
We were convinced that AUD overshot last week on Thursday and Friday, despite the bad economic data.
This morning we short the AUD JPY at 103.50 based on technicals and then when the GDP and industrial production for China came in dismal at 10am Singapore time, the AUDJPY collapsed, we squared off our position at 102.00, the low was 101.65. We made a trading profit of 1.50bps or 1.47%.
We are vindicated from losing monies in the AUDUSD put option last week!
We bought a put option on the AUDUSD this morning on the back of poor Westpac consumer sentiment number.
Let’s see what happens in the next 24 hours.
Our sell order of 1.05 was triggered last night during New York time. Our realized trading profits is 135bps or 1.28%.
The market has proven us correct, the AUD continues to build on strength, the current spot of 1.04961 is trading above the 50 day average of 1.0456 and the 150 day average of 1.0439.
The trade balance posted a strong number with deficit narrowing to (0.18)Bn compared to the previous (1)Bn, this is a very strong comeback.
Our target is to close out the option when we hit the 1.05 level.
Hmmmmm…………..this has been a disappointing trade, we knew back then when we were placing the option trade that the technicals showed a high probability of a breakout based on the bollinger bands, however, we didn’t know which direction it was going to break out on.
Our hunch told us that the crisis in the Euro should settle down for the time being, but the Cyprus issue really knocked down the Euro.
The current spot of 1.2805 is the lowest level for 2013 and way below our breakeven of 1.3180. It is unlikely that we are going to make any monies from this option and the premium paid of 81bps will be a loss.
This is an excellent example of risk management. We knew the Euro was going to breakout, but we didn’t know which direction, we made a bet on going long by buying a call option and we were wrong.
However, if we had a done a spot trade, we would be staring at nearly 200bps loss, in this case, we risk managed for a loss of 81bps.
The Daily Chart; shows strong support for the AUD, the trendline has broken through the cloud and is reversing the cloud’s declining outlook to a rising outlook.
You will recall that our breakeven is 1.0365 and the current spot of 1.0446, gives us a decent 81bps, I think we will hold this position.
This morning at 8:30am Singapore time, the trade balance for AUD came in at (0.81)Bn and improvement from the previous month’s (1)Bn.
New Home Sales declined to -5.2 compared the a positive 4.2 the previous month.
Nonetheless, AUD strengthened alittle and the JPY weakened a little, giving us an opportunity to long the AUDJPY at 97.63 and we closed the position at 97.90 for a 27bps realized trading profit or an absolute gain of 0.27%.
We missed the opportunity to short the AUDJPY on the way down at about 10am Singapore time.
Market is possibly creating an opportunity to long the AUDJPY again, the current spot is at 97.65 and the technicals look interesting.
The Panthenon Investment Group 