Category Archives for Uncategorized

Currency Odds and Ends, Plus the FOMC

Good afternoon (EST), Friends. The current unrest in Iraq has had some impact on currency market sentiment. Japanese investors, as is their custom when geopolitical uncertainty hits, have sold their cross-border assets and purchased Yen. This often seems counterintuitive to those who recall that Japan produces no oil, and is thus very much exposed to […]

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Catching Up on the “Dr. Draghi” (EUR/USD) and “Mrs. Watanabe” (AUD/JPY) Trades

Good Afternoon, Friends. There has been some interesting downside action in the E-minis, and some decent upside movement in T-note and T-bond futures today. Currencies have experienced some volatility, but without much followthrough. There isn’t anything wrong with short EUR/USD (the “Dr. Draghi” trade), but the pair continues to shy away from a confrontation with […]

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EUR/USD: Almost There …

Hi, Friends. Last Thursday, which as you’ll recall was the date of the European Central Bank’s rate decisions, was a volatile day in EUR/USD, with a range of 1.3669 to 1.3502. Since then, we’ve seen a rebound from the low to 1.3676. The currency pair is currently pushing to the downside again, and expectations around […]

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Following Mrs. Watanabe into Long AUD/JPY?

  Good Morning (EST), Friends. Japanese investors are even more desperate than are most of their global counterparts for yield; interest rates have been at, or close to zero, for years. “Mrs. Watanabe” is the archetype of the Japanese housewife who invests her family’s savings in her spare time. As my late, great friend Rudi […]

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Following Up on EUR/USD

Hi, Friends. Well, the European Central Bank did cut rates across the board, setting the rate at which it will accept deposits from banks below zero (at -0.10%, to be precise). That effectively removes one safe haven except in the most violent of storms, presumably making other safe havens – short term U.S. Treasury obligations, […]

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Almost Time for the Euro to Take a (Downside) Break?

Good Morning (EST), Friends. Earlier today, May’s inflation reading for the Eurozone was released. It came in at 0.5%, year over year, versus expectations of 0.7%. The central bank’s official target is 2%. I can almost hear you saying “Great, thanks for the info, and I care because …?” Well, this one may matter for anyone […]

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Long Weekend, Short Euro?

  Good Morning, Friends, Implied volatility of 6% doesn’t seem like much, but that’s a higher level than EUR/USD has seen for a while. Elections to the European Parliament are taking place over the weekend, and there is speculation that a strong showing by Euroskeptic parties of the right and left will lead to a […]

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Winning With Naked Puts

Welcome to this edition of Dave’s Market Insights. Signs and Advantages in Selling Puts I want to put it all together for you today with selling a put.  I also want to talk a little bit about Facebook. We’re going to use them as our example today.  So when I talk about putting it all […]

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Forthcoming Fed Minutes May Lead to Some Slow Hours

Good Morning, Friends. Once upon a time, I built a moderately successful career in foreign exchange – I reached the Senior Managing Director level at a large bank – without ever learning how to read a chart. I did work for a time with people who were enthused about Elliott Wave, but they always had alternative wave […]

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Monday Offers a Fresh Start

Good Morning, Friends. Here’s hoping that you had a pleasant and restorative weekend. I find that I tend to make poor trading decisions when I’m tired or distracted, and I’ve learned that getting plenty of sleep and exercise helps me to respond well to the surprises that a trading day typically throws our way. I’ve […]

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