Tuesday, September 25, 2007

FX Trades and more ramblings on the Dollar Index

I have just cleared two trades with a gain 180pips:

SHORT AUDJPY @ 100.12, bought back @ 98.75 for 137pips
SHORT GBPUSD @ 2.0205, bought back @ 2.0152 for 53 pips

The performance as below,
SEP
Realised Loss : -0pips
Realised gains: +704pips

YTD
Realised Loss : -295pips
Realised gains: +709pips

On the Dollar Index

I'm not trying to play against the trend but as we look further into the Index, the weekly and the daily is suggesting that we are likely to see a bottoming formation in the near term.
The momentum in weekly Macd is showing signs of weakening, RSI 14 at mark 30 proved to be a strong support zone for the index.

On the daily, the candles showed signs of weak downward movements, as if its not willing to move down anymore, well it could be consolidating, we'll just have to see from here. Technical indicators like the MACD and RSI are already showing diverging signals.

Why is it safer to go long on the dollar now? One, you can set close stops. I personally believe so because the dollar has never been so attractive, and no other dollar pair, other than the Euro has managed to cap a new high against dollar even as dollar keeps making a new low...esp the GBP, its proving to be very very vulnerable as of late. I have made a note to myself to keep the GBP shorts on dollar rallys until the credit fears in Britain eases.

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