Washing positions clean

*Back from my trip.
Was over for my brothers youngest Christening in London and met up with some people while there.
Overall impression from the trading community; all bearish, all negative. Usually means their positions are in the same direction. Got that crowded feeling. However, these days, things are different for traders. Most run way smaller positions than they would usually do, even in an environment like this, despite this being pretty much the definition of a trading environment.

Main reason being that the incentive for traders in banks is just not there for the time being. When they make money they dont get paid, if they have a bad run they loose their job. So from that perspective, they basically should not take any risk at all. However, that logic conclusion is unlikely to be workable, since they might then loose their job anyway. I am talking about traders that made serious money in the markets last year, trying to figure out where to spend their calories from here. It used to be that working in London was low on quality of life but high on quality of work and great pay. Right now none of the above seems to apply.



* Washing positions with a sweetsmelling detergent
So the bearmarket rally came around, while I was on my trip of course,,,,
Got to start trading my own vacationevent correlation from now on, will write it down.

Time has come to wash positions clean before we resume existing trends. Since assetclass correlations have been, ehhh, unstable there is a nice time lag to take advantage of. GOLD is definitely a crowded trade, and although it has come down a bit, Im expecting a continued wash.
I have added to my short Gold position. Shorts in OIL havent really started to wash, we will see post the upcoming OPEC meeting. I am still long OIL, looking to add on a break higher.
I have closed my positions in Usd/Try, Eur/Huf and Eur/Pln. I am still long Nok/Sek, but will close on a break of 1.2500.



* Taking on correlation risk to create high octane gamma
I am still shortbanks with Baltic and CEE exposure via puts, but bought a basket of US banks stocks against it. Want to join the bearmarketrally, especially for financials, but want to avoid the digital risk implicit in being long any bank stock with exposure to the Baltics. Further, Id rather be long US financials than European ones at this stage. Working well so far.


As always, good luck


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