While on holiday l did another USDJPY call option expiring 10 March with the following details:-
Spot: 111.86 Premium: 0.90 Breakeven: 112.76
Fingers crossed.
2016 was clearly an interesting year for all traders; Russia, China, Brexit and the US elections. It certainly provided us with alot of volatility, however, what was difficult at times was that the volatility was irrational and we couldn’t make sense of it.
The year was driven by what central bankers were saying, politicians sparring and the rise of populism.
We executed a total number of 56 trades and withdrew 22 trades.
We now have an audited absolute return of 117.28%. Although, it is significantly lower than the 178% we achieved in 2015, we are still higher than our long term absolute return objective of 88%.
I decided not to exit the call option on Friday thinking that it would go higher, but by the time I came back from a late dinner, USDJPY had come back down from 113.70 to about 113.30.
I decided to place a take profit level at 114.00 just in case it bounced back up on Monday morning during Aussie early session.
When I woke up this morning to cook breakfast for my wife, I didn’t pay any attention to the FX rates, but later on, I received an sms from Goldman Sachs informing me that my take profit level was hit at 114.00, in fact, the high was 114.13.
The call option was sold at 114.00 and the resulting trading profit was 0.95yen……not bad!
Now, I still have another outstanding USDJPY call option, however, I have time till mid March.
When US markets opened, USDJPY looked like it was bottoming out.
USDJPY in the past week created a three leg bottom at around 112.20, does it mean that we can potentially see a short term breakout upwards?
I decided to buy a short dated USDJPY call option expiring on Friday, February 17th with the following details: – Strike at Spot; 112.13, Premium 1.0, Breakeven; 113.13.
Now I have two Long call options on the USDJPY.
Let’s see.
Ever since, Brexit has been looming over the UK, all data attributed to manufacturing and services has been on the radar screen.
This evening was the UK Mfg PMI. I didn’t really know which way it was going to swing, but I could sense that it would be a weaker data, so I placed a one leg straddle with the following details: –
Stop if Offered at 1.2566, SL at 1.2586 and Spot at 1.2589.
The data came our flat at 55.9 same as forecast, GBPUSD hardly moved, so I withdrew the straddle trade.
When I saw the yen strengthened so much yesterday, I decided to do the opposite by buying a 1 month call option with the following details:-
Strike at spot; 112.35, Premium; 1.54, Breakeven 113.90, expiring 6 March 2017.
Let’s see
2017 will be the year most OECD countries will be looking at inflation as a gauge of economic growth.
Today was Australia’s turn on CPI, forecast was 0.7%.
I decided to place a straddle trade with the following details: –
Stop if Offered at 0.7565 (SL at 0.7585), Spot at 0.7595, Stop if Bid at 0.76230 (SL at 0.7595)
As it turned out I was surprised at the lower CPI number of 0.5% and with trimmed figures at 0.4%. I wasn’t suspecting this to happen as I believe inflation is running alittle wild in Australia.
Nonetheless, my Stop if Offered was triggered at 0.7565 and I squared the position at 0.7540 for a trading profit of 25bps.
I decided to Long USDJPY at 112.90 with a SL at 112.70.
When USDJPY reached 113.35, I squared half the position for a trading profit of 45yen.
Later on when US opened, the USDJPY just didn’t seem to have any more steam and just when I almost decided to square the position at 112.93, it rebounded and I squared the position at 113.31 for a trading profit of 41yen.
What luck!
Looking at the 4H chart, I couldn’t really see any clarity in the situation of USDJPY, don’t know whether to Long or Short.
However, go to the 15M chart, then, all of a sudden clarity comes into the picture. The spot rate cut above the 50MA at 112.87.
I was out for lunch so couldn’t really do anything, however, I decided to put in a Long, Stop If Bid at 112.90 with SL at 112.70.
As it turned out, my trade was triggered and I am now Long USDJPY at 112.90. Current spot is at 113.28. Let’s follow the spot position and see what happens.
Cheers to all.
I was suffering from insomnia last night and couldn’t sleep, so I decided to turn on my computer at 4am in the morning.
Straight away I noticed that the USDJPY had crossed both the SMA 50 and SMA 200 moving averages.
I immediately gave chase and placed a Long USDJPY at 113.50.
I squared the position before leaving for my 9 holes golf game at 10:30am at 114.68 and locked in a trading profit of 1.18yen!!!
The Panthenon Investment Group 