Monthly Archives: September 2013

USDJPY – Beware Of Sweeping Generalizations

Update 10/04/2013 -> this is purely a technical look based on simple candle patterns, levels and trendlines.. so obviously if some huge govt body makes big news this can get skewed..

as of now.. this week looks BEAR.. (candle closes Sunday night) ..and I'd expect the oversold on DAILY to test up into this weekly BEAR and fail..

wklyjpyzzz

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Friday Keith McCullough mentioned the USDJPY and Bernanke destroying the USD ..ect ect ect .. I’d like to offer a different POV .. positioning .. if you believe like I do that the market is always looking for balance..and the nature of extreme leverage in the market ..makes for extreme imbalance..this can also affect our POV of value and the nature of what is meaningful in price discovery. I’d put forth that price discovery now is alot like chasing your shadow.. your shadow moves and seems to describe you..but has little real relationship to your state of being.

… a couple charts

1) 2005 low USDJPY with 2007 Top .. a ton of room there to make what seems to be factual statements about value ..but in reality are just shadows.

2) Whats happening now and how this triangle looks alot like the 2005 triangle.. I expect a retrace but one that has little to do with Bernanke buck burning and more to do with leveraged shadows.

USDJPYwklyx

usdjpywklyxx

and of course whats really important ..finding balance with your girl

Tandem Surfing

GBPUSD – What It Takes For A Top..Time

GBPUSD 10/09/2013 update - This went higher than expected but doesn't matter if traded right meaning taking small losses on 240 set ups as top forms. Here's Updated look at Daily coming into trend line, with 2 sets of fibs. I expect a bounce and an entry near the trend line..screws the most traders if it breaks trend line then bounces back UP the other way. No matter watch the 240's.

gbpqqq

And here is the weekly - held below the BIG line .. like a champ .. 15700 and 15500 about as far as I'd go with expectations..

gbpwklyqq

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Daily - another new high would not surprise.. but I'm building short entries on 240 chart - this has 100 risk : 500 reward and yet if it goes wrong can still make money ..I like that .. so plan is sell pops on 240 chart..expecting larger time frame's to rollover.

gbp cc1

Weekly - each of the RED top's took time ..but they rolled and rolled big. The red wedge line on top has held since Aug 2009 top. I see a minimum retrace of 300 pips and probably more than 600 pips into next month.

gbpcc2

My world view could be upside down ..but don't bet on it.

VLUU L100, M100  / Samsung L100, M100

 

Classical Thursday

zb130 minute atr trend

zb2daily pivots

zb3upside retracements

zb4downside retracements

zb5regression channels

zb6price support and resistance levels

zb7remaining gaps

On the economic calendar:-
08:30 GDP (Consensus 2.7% v Prior 2.5%)
          Jobless Claims (Consensus 330 K v Prior 309 K)
          Corporate Profits
09:45 Bloomberg Consumer Comfort Index
10:00 Pending Home Sales Index (Consensus -1.0% v Prior -1.3%)
10:30 EIA Natural Gas Report
11:00 Kansas City Fed Manufacturing Index (Consensus 9.0 v Prior 8.0)
          3 Month Bill Announcement
          6 Month Bill Announcement
13:00 7 Year Note Auction
16:30 Fed Balance Sheet
          Money Supply
POMO:-
 
10:15 - 11:00 Outright Treasury Coupon Purchases between $1.25 - $1.75 billion
Speaking today:-
 
10:10 Jeremy Stein
12:15 Naryana Kocherlakota
21:15 Esther George

 

Death Star Redux

The test firing of the Death Star officially known as FAFRRRF has started off around 12B a day and 1bp. T Bills for the end of the year and interbank sets have adjusted somewhat to the reality. FT picked up on the Trinity Site of future monetary policy and its possible fallout consequences today.

Long time readers of "The Corner" are familiar with our interest in Abundance Economics. In a nutshell, a social science founded on the notion of scarcity finds itself struggling in an era of "too much everything." Unlike policy bears who have thrown in with Minsky and string pushing or MMT-ers whose answer to anything is "just do more", we have been followers of Dugger and the concept of the Structural Trap. ( http://onlinelibrary.wiley.com/doi/10.1111/j.1367-0271.2004.00130.x/abstract )

As FT explores today ( with too much Keynes in our opinion) the Death Star could become a facility that re-enforces the structural impediments to robust future growth. http://ftalphaville.ft.com/2013/09/25/1645562/towards-a-widows-cruse-economy/

Structural in the worst way to us as the "archaic and inefficient" industry being supported is the financial sector. Capacity in the sector continues to outpace demand by a wide margin. The system, reestablishing its position as a percentage of the S&P 500 and floundering under the paradox of record debt obligations and collateral shortages simultaneously, exists for the sole purpose of examining its own massive navel. The Death Star merely sprays cold water on a Structurally Trapped, over capacity, demand deprived economy Zambonied smooth by QE. Following the money, many as the zeroes may be, results in a diagram equal parts Rube Goldberg and M.C. Escher.

We return to Dugger: By preventing the needed reduction in excess capacity, a structural trap condemns reflationary policies to failure by making the creation of credible inflation expectations impossible. Faced with a structural trap, an independent central bank with a price stability mandate should adopt a monetary policy stance consistent with restructuring. If political resistance is high, monetary policy decision makers will need to keep nominal rates high enough to ensure that capital reallocation takes place at an acceptable pace.

The product that needs its capacity reduced is money.

Classical Wednesday

zb130 minute atr trend

zb2daily pivots

zb3upside retracements

zb4downside retracements

zb5regression channels

zb6price support and resistance levels

On the economic calendar:-
 
07:00 MBA Purchase Applications
08:30 Durable Goods Orders (Consensus -0.5% v Prior -7.3%)
10:00 New Home Sales (Consensus 425 K v Prior 394 K)
10:30 EIA Petroleum Status Report
13:00 5 Year Note Auction
POMO:-
 
10:15 - 11:00 Outright Treasury Coupon Purchases between $2.75 - $3.50 billion