Long Aud/USD at 0.7771

All positions closed out. 

long 30000 aud at 0.7771, stops at 0.7700. Should be all for today. Breakout of either side will definitely emerge as a new trend. 

Good trades to all.

Closed and Reversed

Reversed to short 100,000 AUD at 0.7747. Stops at 0.7777

Cheers

New Long AUD position

I am long 1,000 AUD/USD at 0.7780, 14,000 at 0.7779, and 35,000 at 0.7792.

Good trades to all.

Trading Losses and Adjustment to Methodology

 Dear mates,

The day has been challenging day for me where I have realised a few mistakes that I could have been on today's losses. Yes, I have to admit that both trades today were made with negligence and with little vigilance. I will thus avoid making this same mistake by not trading between SGT 0800hrs (0000hrs GMT) and SGT 1630hrs (0830 GMT) daily, as I admit that I am not very focused within that time of the day.

Trading time horizon may be in a matter of minutes. Trades are made in a manner that will consistently look forward to an exit on the short term, although it has a primary target that will be looking forward to stay on a trend for the long term. This method may not be a conventional strategy that you may agree with, but it is something that has worked for me for a period of time. 

I shall leave no stone unturned from my next trade, in addition, I would want to remind everyone who is reading this that there is no strategy that is fool-proof and free from losses, therefore, if you are viewing my calls on a consistent basis, please reminded that losses made like what happened over the past few days may re-occur on a consistent basis, therefore I hope you can only view this with a pinch of salt, and measure the result against the actual market.

My 50,000 long AUD/USD at 0.7903 is stopped out at 0.7803 with 100pips of losses. GBP/JPY remains opened from 189.49.

Now let's rock the markets today!!! 

Trade Update

30,000 GBP/USD was exited at 1.7721. 

Stops for 20,000 GBP/USD was shifted to entry price at 1.7682. 

Good trades.

Long 50,000 AUD/USD at 0.7903 and GBP/USD at 1.7681

Hi guys,

For your info, I am long 50,000 AUD/USD at 0.7903, as well as 50,000 GBP/USD at 1.7681. The stop level for both position will be 100 pips away from entry price. Existing long position of 15,000 GBP/JPY, remains open at 189.49. 

 

Will be looking forward to reduce my position before tomorrow's voting with the congress, and the NFP announcement. 

Good trades to all. 

Long GBP.JPY @ 189.49

For your info,

I have just made a 15,000 long position on GBP/JPY at 189.49. 

Global Economic Scorecard and Outlook

Hi all,

It has been another interesting week that will make history in the global financial markets where the US markets lost a total of $1 Trillion on the market bourse, as Dow was down 777 points closing 10,365.45, Nasdaq down 199 points closing the day at 1983.73, S&P 500 down by 106points closing the day at 1106.39, in the US market trading.

Asian bourses was pretty weak gaining what was lost from the opening at mid-day with STI closing down 2.43 points at 2358.91, Nikkei 225 closed down 483.75 points at 11259.86, Hang Seng closed up 135.53 at 18016.21 (where tomorrow will be a public holiday), and Chinese stock exchanges closing for the week for National Day.

The selling in the earlier session was sparked by a rejection of the bailout plan that was proposed by Henry Paulson, and his Fed aides, as many market participants held high hopes of the implementation of the proposed rescue package. In my opinion, a veto on the proposed bailout plan may not exactly be a wrong move for the US economy on the long term. I may not be a US taxpayer, but to be transferred an obligation, and to 'foot the bill' for mistakes made by others, would make me feel upset about it as well. 

These troubled institutions have, for the past decade adopted a loose system in assessing the credit-worthiness of their borrowers, and thus, lent out billions of dollars to NINJAs (No Income No Job or Assets Individuals). As a result, causing a vacuum in the credit system. With fear of further failure with banks, the Federal Reserve has, since March, spent on these items:

1. JP Morgan's takeover of Bear Stearns, brokered by the government ($29B)
2. Liquidity Injections such as Term Lending Facility and Term Auction Facility ($200B)
3. Economic Stimulus Package ($168B)
4. Refinancing of failing mortgages into new and reduced principal loans with a guarantee ($300B)
5. AIG's bailout ($85B), can be up to $400B due to AIG's CDS on CDOs, CMOs, MBS, and etc...
6. Fannie Mae and Freddie Mac $200B, can be up to $800B
7. Money market insurance (likely another $50B)
8. MBS purchases ($10B), up to $800B.
9. Global credit market injection $300B just last Friday.
   
10. Repayment to JP Morgan for providing liquidity to Lehman's bankruptcy ($300B)
11. What if the 2nd attempt of the bailout proposal succeeds this Thursday? ($700B)
12. Taken from an article in Reuters, US banks and money managers had to borrow $188B a day to keep afloat.
    

Do you think the Fed has been successful with such spending and injections? What is it about another $700B of injection, will the system stabilise because of these injections? 

As of 30Sep2008 Libor Fixing

        Tgt   O/N    1mo   2mo 3mo 3m chg
US  2.00% 6.875 3.926 3.966 4.053  17.0
UK  5.00% 6.781 6.075 6.156 6.300   3.9
EUR 4.00% 4.449 5.050 5.130 5.277   4.0
JPY 0.50% 1.031 0.926 0.950 1.015   5.4
CHF 2.75% 3.333 2.800 2.860 2.955   2.5
CAD 3.00% 4.500 3.997 4.100 4.208  0.8
AUD 7.25% 6.938 7.775 7.725 7.800 3.7

Taking a look at LIBOR (London Interbank Rate) which is a rate for interbank lending, is at a nervous state, as banks begin to lose confidence with one another, loans offered by banks to retail customers are also shorter, and do you think bulk cargoes that are shipped long distance by ship easily get their financing as well?  

Next, let's take a look at European banks, are they any better off than us? Here are some numbers:

• More than $300B of credit insurance were written by AIG to the European banks.
• Deutsche Bank leverage ratio is 50x, 80% of Germany's GDP.
• Barclay's leverage ratio is 60x,  100% of UK GDP
  
• Fortis's leverage ratio is 30x, 300% of Begium's GDP.

Scorecard: Avg Leverage Ratio (US Banks) 20x Vs Avg Leverage Ratio (EU Banks) 35x

The numbers speaks for itself. If you have read the contents that was written above, you would derive that we are currently in the phase of a global slowdown, also called a recession. Let's not deny that. 

As for my personal opinion as to where funds could be invested, for the moment, even though stock valuations are already at one of its lowest levels, I still believe cash is king, for those who are not involved in the forex markets. But if you are into trading forex, crude oil and gold for the week, I would suggest everyone to only try holding on to short term positions, as news of intervention and further injections from central banks may come anytime, causing the markets to be a little volatile at times.