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firewalker

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On a fundamental vein...

 

I don't know why I never thought of this before, but is it really possible that the central banks around the world have made matters far worse by being so free with their money? Big Ben and his helicopter are dumping everything they have on the problem. Practically any bank that wants to borrow from them can.

 

AND THAT IS THE CRUX OF A MAJOR PROBLEM.

 

Why on Earth would any bank want to lend to any other bank if they can get what they need from the central bank? Why would they risk lending to another bank that may or may not be solvent if they can get their money just about as easily from a central bank???

 

THAT is why Libor is increasing so much. And that is also why banks will continue to be unwilling to lend to other banks. Throwing tax payer money at the problem won't help. Recapitalizing banks with taxpayer money probably would help, but it won't help fix the interbank trust issue - not until banks are so fully capitalized that they can see there will be no solvency issues. That could take a long time.

 

So that brings up another issue. How on Earth is the Fed going to be able to wean themselves away from the banks, now that they've got breasts the size of Manhatten?

 

The situation we're in now can't possibly get better anytime soon. At least, I can't imagine how it could.

 

For more about this - a really good read... try this:

 

http://www.nakedcapitalism.com/2008/10/are-central-banks-making-libor-worse.html

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Where next? (my attempt at being Buffet!)

 

http://news.bbc.co.uk/1/hi/business/7521250.stm

 

This is all becoming too obvious... Gapped up as expected.

 

Especially with the infuriating bank bailout here. Now its Japans turn to feel the squeeze as the pound rises back up a bit, everyone eases off a bit and the TV informs everyone they can relax as the good old government bails out the greedy idiot bank CEO's who helped cause the mess with their mortgage lending and we are all safe. So they borrow to bail them out from their gambles and the bank of England makes money back on the interest from their loans, everyone is told the economy is leveling out yet the average man gets fucked whilst the fat cats still get richer. Makes you sick.

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Makes you sick.

 

It does... but what really gets my goat is this ridiculous 30 pip spread on GJ!!! That's double what it was last week. It's insane.

 

If the bailout works, the yen will get squeezed hard, I imagine. But there's an awful lot of confusion right now. No one even seems to know if the stock markets are open in the US on Monday, given that it's Columbus day. Why wouldn't they know??? It's no different than it was last year, and the year before, is it?

 

Anyway, I suppose you've already gone long on GJ, haven't you Wasp?

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only just, waited for a little dip and was in. Can't see why anything would be different for the US markets for tomorrow? Strange...?

 

As for spreads, why on earth do you still use them?!! 30 pips is criminal!

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Look out for that big-bad daily trend, Wasp... Price might not slice through that zone like a hot knife through butter. But it would be nice if it would... add a little weight to the move.

oct1208a.thumb.gif.41a1e82402bb2900d9eeb2f30a55110d.gif

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As for spreads, why on earth do you still use them?!! 30 pips is criminal!

 

They're typically pretty good - but they do go up over the weekend and for the first 6 hours or so of trading on Sunday. Then the spreads shrink back down to around 6 pips, which I can tolerate. But they haven't pumped the spreads up to 30 like this since... hmm... every major crisis period we've had since that first August 2007.

 

If they keep it elevated too long now, I'll have to re-evaluate who I do business with.

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Look out for that big-bad daily trend, Wasp... Price might not slice through that zone like a hot knife through butter. But it would be nice if it would... add a little weight to the move.

 

I'm going to hold off and see if I can't snag an entry a little closer to that daily support line. Seems to me price should be able to muster a pull-back to that level before a more concerted effort higher occurs.

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Good call on keeping an eye on the daily descending trend line.

 

I've attached an hourly chart with trend lines and horizontal support. There is resistance from the daily descending trend line and horizontal support from 174.35 via the 240-min chart.

geppy_1hr_10-12-2008_suday.thumb.gif.cdb848229b719773528f4b9b3aa0bad7.gif

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GJ short 171.94

 

I'm holding fire until the end of this hourly candle. Entries for me will only be on the hour, every hour and at no other time. I've decided I have to be absolutely rigid about that.

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I thought the rejection off the daily down trend line was pretty a pretty good signal.

 

I scaled my trade at +300 and closed at +197. The damn thing retraced close to 100 pips is like 5 seconds at when price touched 168.00. I was at +378 at that point. It's really difficult to for me still to decide when to close out. I'm still quite happy with the results none the less.

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I thought the rejection off the daily down trend line was pretty a pretty good signal.

 

I scaled my trade at +300 and closed at +197. The damn thing retraced close to 100 pips is like 5 seconds at when price touched 168.00. I was at +378 at that point. It's really difficult to for me still to decide when to close out. I'm still quite happy with the results none the less.

 

As you should be! Nicely done.

 

As for that drop to 168... look closely and you'll see that it only appeared on the Oanda platform. Alpari didn't show it. They were playing some sort of very nasty game - dropping it 100 pips and then bringing it right back up. Glad I wasn't in on that. I haven't seen Oanda do that in well over a year. That's strike two against them now -- and all in one day.

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You're right! I hadn't noticed that it didn't drop to 168 on Alpari. I saw a longish wick and assumed it dropped the same. I'm with you regards Oanda. If they're going to start with that kind of shenanigans, they won't have my business much longer.

 

I was looking at HotspotFX today. It looks pretty good and even has an API to hook up Metatrader 4. I'm not a programmer of that level so I'd have to use their regular interface. I also couldn't find what their spreads and commissions were either.

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Thought so. Glad to meet you here. Are you still finishing school or are you into this full time now?

 

Hello Jack

I’m still in year 11, working toward a clutch of A-Levels aiming toward College induction further out. Plenty time to decide which career route to take later on.

 

Japan & U.S on vacation today so liquidity thin & choppy until Europe gets fully operational, hence the primary reason for those excessive spreads at some of those retail shops Cowpip.

Traders will also still be digesting the G7 comments/actions/repercusions too I guess.

 

Cool piece in the Inde yesterday.

http://www.independent.co.uk/news/business/news/a-163516-trillion-derivatives-timebomb-958699.html

 

 

Right, off to school to hopefully learn some new stuff ;)

Looks like the markets might just be courting a little risk today on the back of those muppets at the G7. You yen cross traders could be in for a wild ride today.

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I’m still in year 11, working toward a clutch of A-Levels aiming toward College induction further out. Plenty time to decide which career route to take later on.

 

You sure you're only in year 11??? You've been hangin' out with Mark and the gang too much, haven't you? Tsk tsk.... they'll rot your brain with wealth faster than an apple in a hot sun. ;)

 

We've heard good things about you (through them). Keep it up, mate!

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What a bore today... Missed the ride back up last night. Had to sleep sometime. It's getting closer now to an entry, but so far, no luck.

 

It'll be most interesting now to see how the U.S. system reacts to all the European news. They were the only ones not to spell out specifics at their G7 meeting. They may regret that now, if they don't back-step first.

 

ADDED: There's news out now that the UK, Swiss and European central banks have set no upper limit to their U.S. dollar swap operations. Sigh... how thick are they, anyway? Throwing unlimited cash at the situation isn't going to improve interbank trust. But it WILL improve dependence upon the central banks - which could have the side-effect of degrading interbank trust further.

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Nice one on catching the down move guys. I was expecting a HrL to cement the uptrend and bought into it thrice. I wasn't expecting it to use the original trendline to find it though... Needed this run up to counter the mess overnight!

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You've been hangin' out with Mark and the gang too much, haven't you

 

Ha ha ha, yeah our Grandparents keep reminding us of their unsavory influence :o

 

I might appear a little sad, but to be honest I got all the same leisure pursuits as my friends.

It’s just we all have been bottle-fed this stuff from the cradle so it’s no biggie to our cousins & us.

 

Our older twin brother/sister aren’t interested in a trading or finance career even though they got a flair for it. One is studying the law, the other medicine. My younger sister is sharper than me at this & she loves it, but who knows how she’ll feel in a few yrs.

 

The one big advantage we all got is the fact we can generally navigate our way around out there without getting into too much trouble. We’ve been taught a few consistently reliable technical set-ups & triggers to employ in specific market conditions & got a basic handle on the fundamentals.

 

At the very least, it offers a good structure from which to learn more & pro-actively manage our own funds & investment capital going forward.

 

Apart from that I’m heavily into sports, parties, music, girls & not necessarily in that order :cool:

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I guess the ‘risk appetite’ play turned out ok today? :)

 

I took a snag of this morning’s activity on this cross as Europe loaded up, but couldn’t log back in before I had to leave for the day.

 

The guy’s here were confirming that liquidity remained dire across the board even as Europe opened up after the w/end, so maybe it would have been a gamble to take it on this morning – however, there was some cool 4 & 1 hour action playing out.

 

I don't play the pound/yen pair very much, but that high close doji on the 240 & those bullish inside bars on the 60 ahead of that 171.37 are the types of price action I personally like to see. That looked like powerful teaser material & might have tempted a feeder stake via that 15min bullish action off the higher low steps?

 

I guess initial targets were visible at the weeks opening print high at 173.45 sounding out the higher focus swing at 175.90?

 

Certainly appeared the likely (less risky) bull play at the European Open if you were actually looking to play any increase in risk appetite & catch an uptick in volumes.

 

vsnbc6.jpg

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Nicely done, Bobby!

 

I missed the entire move up. I was whipped last night and couldn't stay up long enough to get an entry. When I woke up, it had already moved almost 600 pips, so I'll wait for the next bus. But that was a nice clean move.

 

Frustrating I couldn't hitch a ride on that one! :angry:

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Oh, I wasn't on it Cowpip. I didn't play it, I just saw it setting up & thought I'd try post it before I got my backside kicked out the door.

 

I prefer the eur/$, the Cable & $/Swiss. If euro is attracting decent attention (either direction) I might have a watch of eur/yen for a popular set-up or two, depending on flows, but that's usually my limit on the crosses.

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