Market Talk: EUR/USD and that 1.20 ‘magic’ level

It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.
Henry Ford

Well, here we are. Just before New Year and right at the very end of the calendar year life for this rather strange 2014. And as a final gift, the Euro is just poking its nose in the danger zone of the longer term triangle formation.

As you can see from the attached weekly chart, the pair is presently hitting the bottom line of a long-term triangle (assuming it is correctly drawn, that’s the beauty of fine art), as well as nearing a key value area in the 1.21-1.16 region. There we also find the “projected value level” as defined by some economists (those who will never risk a dime trading it, anyway), for the two currencies in the long run. All in all, we certainly are at a very interesting level and in a very particular time of the year, when liquidity is not plentiful to cover for some ‘positions’.

I personally have no position in the pair at present, and unless the price action dynamics change rapidly, won’t be involved in it until next year ;-)). But, I must confess I do see value in those calling for joining the long scenario in the pair from a technical analysis perspective (hence why you see the attached chart). However, I’d like to approach the scenario from a risk management perspective; i.e, that anyone considering buying the pair does that provided he starts covering it on scaled volume (light here at the first level) around current levels @ 1.2150, and allows for that scale to reach down -through intermediate levels- the worst-case scenario printing of 1.1650 to come before any sizeable bounce takes place. My technical targets are in the region between 1.27-1.30 if the support line holds, 1.23-1.25 if we see fireworks going south first.

Although it may not bear  special significance, given the fact that this 1.20 level has already been ‘named’ or hung in the air as a desirable exchange rate level by those in control of issuing the €uro currency, for in their (¿tiny?) minds that would be a good thing, as in order to prop up exports and foster economic growth (which means €urope is now Japan II, bar the QE bonanza, which thankfully thus far has not yet been shoveled down the people’s throats), we may also be witnessing the beginning of the establishing of a new ‘normal’ in the EUR -vs- majors exchange rates. In this regard, the chart attached gives an idea of what that ‘new normal’ might be, for if the green vertical line, which measures the amplitude of the defined triangle, is the measure of how low we’ve got to go in the times ahead (remember, this is a weekly chart), then parity is seriously under peril, something some of those considered to be ‘big experts’ have been barking about recently, and which might exactly be what technicians are also looking at right now…

For my personal diary, I will hold onto my GBP/AUD short position for now, keeping an eye on 1.9220 to take me out of it, aiming @ 1.8930-35 first and then 1.8815.

FX View: GBP/CAD (Update)

By constant self-discipline and self-control you can develop greatness of character.
Grenville Kleiser

A couple of events here and there, what I call -and will always call- ‘excuses’, have served our cause just fine today as both the EUR and GBP go lower on the day, with the CAD and USD being the major beneficiaries of the move.

With prices now around 200 pips from the entry point in the GBP/CAD scenario, we will preserve a bunch of them @ 1.81, still aiming @ 1.7930-35. However, the intrinsic dynamics have changed rather rapidly in this pair after today’s sell-off, so it’s wise to protect what’s in the table at the moment.

FX View: GBP/CAD

The best way to get approval is not to need it.
Hugh Macleod

In my not-so-conventional way of approaching the FX market, I’ve got to tell you from the start that I mostly trade crosses, with majors being a non-demoinant part of the portfolio.

The scenario that I’m discussing here is a short approach to this pair at current levels 1.82. If we see the recent top @ 1.84 being taken out, then the scenario becomes immediately invalid. Make use of intermediate levels (should the price get to them) like 1.8300-10, to get a better risk/reward for the scenario as a whole.

The so-called commodity currencies bloc (invented by someone very ‘clever’, of course) is being hit in the wake of the current ‘oil crisis’. I’m sorry, but I can’t hold myself off from LOL! And why is that? Simple. Just about 3 months ago, the price of oil was about $105/bbl. In this short lapse of time, by some miraculous event, not only has the price been cut in half, we now learn that global demand will be very weak for considerable time to come and that prices might even fall more! Yeah, right………….

Unfortunately, or very fortunately if you look at the bigger picture, the West (elite  psicopaths) is waging war against Russia (and not the other way around; believing that means that you are either a) on the psicopath’s payroll or b) a gullible, easily-manipulated ignorant who will be ‘loved’), using all of its non-material arsenal at once. This includes:

1. Crude Oil Futures Contracts: through the Wall St thug-crowd, they’ve (in connivance with the deadly kingdom of Saudi Arabia) plunged the value of oil, so that the largest oil and gas exporter, Russia,  whose economy is largely reliant on stable prices for those commodities, ill get hit…hard.

2. Currency Manipulation: The Russian currency has plummeted by over 70% against both USD and EUR, some days falling (and rising) by over 10%. This is something that would not be possible without some inside help. Russia’s fifth-column traitors are in its central bank. Though a good chess player, I reckon Vladimir Putin has only realized this now, and has started a campàign to purge those working for foreign interests inside Russia.

3. Sanctions: Black lists in order to grab other people’s assets legally. Of less overall importance here.

The good thing about dominating (for now) the financial world, is that all that’s been written above becomes irrelevant when gauging the moves of those currencies that would have to suffer the effects of such a ‘grave’, although fabricated, situation. This is the case of the CAD, part of the G10, which yes, it has been hit recently, but should it be so pegged to the value of oil as ‘experts (in the payroll) say’, it would’ve had to plummet by some 25-30% give or take. As I say, nothing like being the creator of the market yourself to know up to where things can go (again…..for now). With Russia unloading its FX reserves (in a move directed by Putin, bypassing 5th column traitors at the central bank), and China holding those US treasuries en masse, I think the US-idiocy days may be –hopefully– numbered.

OK, back to the topic of the GBP/CAD scenario. My view isn’t at all based on the macro view perspective shared here, that is my personal account of things. But if stabilizing the RUB and Crude Oil makes it for the CAD to strenghten, then I welcome it; though not needed. The intrinsic price action of the cross is what makes my call to come out,  The rest is a nonsense game by people that should be better locked up and play Monopoly to satisfy their aires de grandeur.

Let’s get FXed

A handful of patience is worth more than a bushel of brains.
Dutch Proverb

They say I’ve got a hand at writing, and it’s taken me far too long to actively engage in the sport again. But here am I. As good as new. My name is Antonio Juste, am from Spain and I trade spot FX live, currently serving as the founder & CIO of Olton Capital, Ltd., a boutique firm that specializes in currency investments on behalf of its investors.

I intend to bring the reader closer to the market that really and ultimately affects and directs our lives, from an out-of-the-box, unconvential road. This is a road I have paved by myself with my own two bare hands and feet, the cost of which does not constitute a topic for this blog; reaping the benefits, in whichever way or form you choose, is. This blog will include technical/price action related posts (with some randomly handpicked live positions in the market), as well as a personal perspective on important matters regarding the money structure around the world.

The FX/currencies market is the ultimate game as far as our developed mind goes. It is home to the largest sums of capital being transferred, its moves have a direct impact on nation-states economies as a whole, and it is a tool that may be used to wage geopolitical war without having to drop a single bomb. It therefore constitutes a weapon of mass destruction by definition, if used with such a purpose.

The way I approach them is unique. No, I don’t seek recognition for that. What I simply state is that out of the hundreds of traders I’ve met since I professionally started in this market (back in my old days @ FXstreet.com), none is approaching this market the way I do. We do, however, all share one thing in common: we all rely on the ‘fantasy’ we live in -called efficient markets-, to go on for a while longer. That is equivalent to say we rely and depend on the system engineered before and put in place since 1971 by the ruling elite of our world (yes, come on, call me a conspiracy theorist, I’ll love to hear it from you). With this I just pose the reasonable doubt -which wasn’t present until now- that we, as a whole, may be on the brink of formidable changes, with its many side effects attached. Trying to change what’s been estabilshed over the last three centuries won’t happen without a tremendous amount of effort, that’s guaranteed. Those in the ‘pole seat’ won’t get off it without a fight.

OK then, let’s get FXed. Welcome to my Macro view of things. Hope you stay here for good.