Thread: Trading The quotNormal Statequot

95012

Originally Posted by ;

Lol-down thru history, all of the great thinkers have had their thoughts met with resistance.

Clearly, there's no way to repay this now one way or the other so we'll just have to wait a few years.

I do not want to be right or wrong on this so there's nothing to repay.

I merely meant to say it's not something I view as positive over what we're all here to do - trade actively. If it had been I'd have just bought a lot of ETFs (exchange traded funds - index trackers) or a similiar thing with a little or no lever and placed all of my funds in that, sat back and prayed - and then spent all the 2-4 months of this mini-crash biting my nails and then cheering on the way upward, like every know-the-markets-only-from-newspaper-reading-John-Doe fella on the market.

As it is I rather actively traded throughout the meltdown and then on the way back up.

I am only saying it's not my investment or risk profile. . .and therefore doesn't suit prognosis or my beliefs / time horizon / whatever you would like to call it.

Originally Posted by ;

Every economic downturn has been a buying oppurtunity.

My counter-points remain valid regardless of that the phrasing for me(contingency / causality / profile).

Originally Posted by ;

Recessions have gotten less frequent and therefore are shorter lived.

Whenever the DOW and SP move up-the JPY crosses go up.

So why not buy shares, inventory based funds, index trackers..dividends will pay the equivalent to interest e.g.
Where is that anything new when compared with this guy that said buy shares,money in 80 years later? Can't recall who it was, one of the names anyhow.

Originally Posted by ;

You are making one easy bet here-you're betting that the world isn't going into a really protracted depression. Unless that happens-you can't lose.

Well either that, but that is because of its stock markets actually, or that there won't be a decorrelation, a running off in the Yuan and JPY therefore subsequently and the yield curve remains intact, etc, and so on.

Not my thing.

95012You have seemed to place this in a in case this may be the only egy employed. It is not meant to be an argument over whether to trade short or long term-it's a investment egy-one investment egy.

You can trade shares, indexes etc but this really is a Currency Market forum I did not go into egies there.

So let's look at a current egy for trading this. As of this moment, the chance of recession has diminished although by no means has it entirely diminished. We are going into quarter profit season and this past year is the one that endured through the worst of this liquidity crisis. Alcoa is the initial big corp that will report (Tues, after the market closes).

There was a really practical article on Bloomberg now:
U.S. Stock Market Stumble Presaged by SP 500 Options
http://bloomberg.com/apps/news?pid=2...WDPUrefer=home

Clearly a lot of places are accepted as insurance against a loss from the indexes which means that stress is still high. So if those profits really come in below expectations, then you need to be prepared to close out your trade here because recession is once more threatened.

And if they really do surprise to the upside (entirely possible) you simply stay in.

As far as a shorter duration egy is concerned, if recession is jeopardized the indexes will fall. In that case-this is exactly what's going to occur to currencies:

GBP, EUR, AUD, NZD/JPY will fall.
The Dollar will appreciate against the above mentioned high yielders and depreciate vs the Yen.

Of course, if earnings surprise to the equity markets will likely finish the year out really well. The JPY crosses will appreciate right along with them as the Dollar weakens vs the high yielders and gains on the Yen.

The questions are definately out there-and a lot of potential profits too.

95012

Originally Posted by ;

Of course, if earnings surprise to the upside equity markets will probably finish the year out really well. The above mentioned JPY crosses will value along together since the Dollar weakens versus the high yielders and profits on the Yen.

Well that basically sums it up, I really don't understand what you guys are arguing about for such a long time. The stock market lures foreign exchange and changes the requirement for certain currencies verses others. Pairs that are regulated by (or basically derived from) the dollar pairs will be affected by the US stocks. No mystery there.

The mystery is in how a person can bet on a currency pair for months at a time, using leverage of charge, and pretend he's going to make it out alive. Forex shouldn't be traded ultra-short-term or even uber-long-term. Forex ought to be traded sane-term, if you would like to make full use of the benefits you were supplied with.

Top economist at the NBER and the arbiter of recession says that the condition of this market is growth. He presented at the Jackson Hole assembly and said that the fed required to cut by a direct 50 and that is what they did.

The GBP/JPY and other JPY crosses are attached to the market via the equity markets, who's normal state is growth. That means that you remain in GBP/JPY (and another pairs too) because their regular condition is growth.

You escape from those trades when extreme economic conditions exist-like during the August liquidity squeeze. You get back in as the emergency passes. This time around, certainly 234 was a buy.

Since that time , it reached a top of 239.17. It's now at 237.83. You might have a look at this and think u lost 134 pips-but you have not! You're still at a profit and you are still getting paid regular to the interest. The profit is the gravy. You're getting an 80% rate of interest!

Your making just like 80% interest to the year on GBP/JPY.

95012

Originally Posted by ;

The best economist at the arbiter of recession claims that the normal state of this economy is growth. He stated that the fed required to cut by an immediate 50 and that is what they did and presented at the jackson Hole meeting.

The GBP/JPY along with other JPY crosses are attached to the economy via the equity markets, who's normal state is growth. That means that you remain in GBP/JPY (along with the other pairs also ) since their normal state is growth.

You get out of those transactions when intense economic conditions exist-like throughout the August liquidity squeeze. You get back as the crisis passes.

Your making like 80% interest for your year on GBP/JPY.

Interesting. Have you been long the GBPJPY 10, how many years? I understand you're a news trader (or reporter) but can you show some mathematics on how you came at 80% interest to your year?

95012Check with your broker and see what they pay per lot per day on the swap when you're long GBP/JPY

95012The mystery is in how someone can bet on a currency pair for weeks at a time, using leverage of credit, and pretend he's likely to make it out. Forex should never be exchanged uber-long-term or ultra-short-term. Forex ought to be exchanged sane-term, if you wish to make use of the advantages you have been provided with.

Show me the study that says you'll just lose if you trade in an uber long term.

95012

Originally Posted by ;

That is your explanation? CO2 levels rose during the same time. Why don't we tie the rise in GBPJPY?

Care to throw some 1999-2004 graphs?

lol. I had to laugh @ this one.

95012The dollar should become a currency rather than a one. That means that dollar should fall against yielders?? no?

95012

Originally Posted by ;

Check with your broker and determine what they spend per lot every day on the swap when you're long GBP/JPY

Let us assume it's two pips or you could add a number if you have a greater one. Now show me the way I could make 80% so far this year.

I still didn't ch your reply on how many years you've been long GBPJPY. After all, we are living in an expansionist state right?