* The swift moves in the markets this week seems somewhat overdone - for now.
Im taking partial profit.
I believe well see more of these bearish developments ahead , but there is a good chance of an assetbullish reaction first.
*Open positions and positionchanges
- Took profit on my short Gbp/Jpy
- Took profit on my long Usd/Zar
- Took profit on my short Aud/Usd
- Took profit on my short Aud/Jpy
- New position; Short Gbp/Chf
Never got hold of short position on the Australian ASX 200 index. Bought ETF;s on short European indexes instead. Took profit there as well.
Still short Eur/Usd and Gbp/Usd.
* Other
Getting a view on deflation - stagflation - inflation.
More on these subjects in a later posting.
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
25 August 2010
16 August 2010
CNY reval to the (temporary) rescue or not?
* CNY reval is on the agenda again. From a Chinese perspective it might become a necessity as steps are taken to try and manage this leveraged economy.
On that note, got some info re counterfeiting in China. Alledgedly, if one deducted Chinese growth stemming from counterfeiting, the annual GDP growth would be zero. If one applied "green accounting" all current GDP Chinese growth would be erased as well. So, all in all, deducting these two variables, the remaining net Chinese GDP growth would be negative.
Add to this a highly leveraged, centralised and very corrupt regime and a cowboy style economy you end up with,,,, Russia in the nineties? Only, the variance in livingstandards in China is even greater than in Russia back then, hence the risk of socialtensions and massive political turbulence is higher in China.
What Im trying to say is; In the "short" run the Chinese economy is overvalued and overexposed.
*Oh yes, the Chinese reval.
Well, although there are some bearish winds blowing again, a CNY reval should actually be good for riskappetite. This would definitely disturb the AUD case shortterm. Especially since the AUD would likely be one of the currencies benefitting most from such an event.
Ill return on this issue later on.
* Was a bit quick in going short CBA and Westpac - its just not doable. These stocks are stilll under a shortingban. Wonder why,,,,,, Oh well, Ill try the index instead then - if possible!
* New positions and positionchanges
No changes.
* Other
- Still trying to add a short Australian equity position - well see.
- Pondering the deflation vs inflation, stagflation outlook. Been a deflation "fan" but am currently reassessing.
- CNY revaluation timing. Not good for AUD bears when it happens. Stay posted.
- JPY intervention; Not before 80 in Usd/Jpy. Stay posted.
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
On that note, got some info re counterfeiting in China. Alledgedly, if one deducted Chinese growth stemming from counterfeiting, the annual GDP growth would be zero. If one applied "green accounting" all current GDP Chinese growth would be erased as well. So, all in all, deducting these two variables, the remaining net Chinese GDP growth would be negative.
Add to this a highly leveraged, centralised and very corrupt regime and a cowboy style economy you end up with,,,, Russia in the nineties? Only, the variance in livingstandards in China is even greater than in Russia back then, hence the risk of socialtensions and massive political turbulence is higher in China.
What Im trying to say is; In the "short" run the Chinese economy is overvalued and overexposed.
*Oh yes, the Chinese reval.
Well, although there are some bearish winds blowing again, a CNY reval should actually be good for riskappetite. This would definitely disturb the AUD case shortterm. Especially since the AUD would likely be one of the currencies benefitting most from such an event.
Ill return on this issue later on.
* Was a bit quick in going short CBA and Westpac - its just not doable. These stocks are stilll under a shortingban. Wonder why,,,,,, Oh well, Ill try the index instead then - if possible!
* New positions and positionchanges
No changes.
* Other
- Still trying to add a short Australian equity position - well see.
- Pondering the deflation vs inflation, stagflation outlook. Been a deflation "fan" but am currently reassessing.
- CNY revaluation timing. Not good for AUD bears when it happens. Stay posted.
- JPY intervention; Not before 80 in Usd/Jpy. Stay posted.
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
11 August 2010
The Australian housingbubble - will it bring down CBA and Westpac?
* I havent really noticed much publicity when it comes to the Australian housing bubble.
However, Ive had a look at it and its very,very scary. As always, its a matter of timing, but I believe were getting there before long. Hence, I am selling the Aud as well as the Australian banks CBA and Westpac (they hold 50% of the Australian mortgagemarket). The loan to equity ratio is so high that a 6% writedown of mortgages would wipe out these banks equity. When this housing market heads south, a 6% writedown will be a best case scenario,,,,
Ive got some quite compelling research on the subject. If you´re interested in obtaining it, send me a mail.
* Yesterdays FED comments post the FOMC decision provided a minimum QE outcome.
It is doubtful this will match the high expectations that were build up pre FOMC. The impetus from this for assets should be a weakening one.
* New positions and positionchanges
- Added to my short Aud position
- Looking for the best ETF;s to short CBA, Westpac or ASX 200
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
However, Ive had a look at it and its very,very scary. As always, its a matter of timing, but I believe were getting there before long. Hence, I am selling the Aud as well as the Australian banks CBA and Westpac (they hold 50% of the Australian mortgagemarket). The loan to equity ratio is so high that a 6% writedown of mortgages would wipe out these banks equity. When this housing market heads south, a 6% writedown will be a best case scenario,,,,
Ive got some quite compelling research on the subject. If you´re interested in obtaining it, send me a mail.
* Yesterdays FED comments post the FOMC decision provided a minimum QE outcome.
It is doubtful this will match the high expectations that were build up pre FOMC. The impetus from this for assets should be a weakening one.
* New positions and positionchanges
- Added to my short Aud position
- Looking for the best ETF;s to short CBA, Westpac or ASX 200
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
10 August 2010
Time to change positions
* Its been a great bull ride since June in Equities, Eur, Aud and Oil, not to mention Wheat (ahhh, what a rocket).
However, I feel now is the time to reverse these positions - again.
Why? Well, to me the weaker Usd was a temporary retrieve in any case. The Usd is coming back soon due to a leveling of positions and the markets overpricing of QE is US vs recovery in Europe. Hence , I believe we will see a relative shift in long term rates favouring the Usd.
I am going long the Usd.
* The China syndrome - soon in Australia?
Australia is to suffer on the back of continued Chinese tightening as well as continued weakening Chinese assetmarkets. According to research, Chinese GDP growth is 100% due to the domestic industry of making fake brands. At least that makes me quite worried. Top it off with a very centralised structure, high leverage, insane capital allocation and you have the recipe for a real bubble burst with a bang. On the positive side; Basel 3 will likely mean an increased allocation from banks into reserve currencies such as the Aud. Short term, however, Im a seller of Aud.
* Equities still in a range - but its about to move lower within it.
Equities will still be looking good from a capital allocation model point of view, but short term I believe the market has gotten ahead of itself. Europe is not out of the woods - not by far.
I am going short European Equity indexes.
* While Oil may very well be in short supply going forward, the Gulf issue is overplayed and so is the demand for now. Im going short Brent Oil.
* The Wheat panic rocket is falling back to Earth - ish. Beware of setbacks.
However, with the recent move and the Russian wheat export stop and bad harvests already discounted by the market and a very, very swift move higher. I am at least looking for a correction lower before we get a top out test of the former high. Caution warranted though. Proper strict riskmanagement should be applied, as always.
* SouthAfrica - the Worldcup is over and the shine has faded. Whats left? A corrupt government, trying to silence the press in order to make room for murky deals and yet more corruption. This country was meant to set an example for the rest of Africa, leading openness,transparency, education, social responsibility and growth. Now its heading the other way. Mandelas legacy is fading fast. On top of it, neither the World Cup, nor the Olympic games are rarely an economic success for the hosting country, rather the opposite. I doubt it will be different for South Africa.
I am buying Usd/Zar.
* Positions and position changes
- Took profit on my long Eur/Usd position, reversed.
- Sold Gbp/Usd.
- Took profit on my long Aud/Usd position, reversed.
- Sold Gbp/Jpy.
- Took profit on my long GLL ETF (short gold).
- Took profit on my long LOIL ETF (Long Brent Oil).
- Went long SOIL ETF (Short Brent Oil).
- Long Bear ETFS on European Equity indexes
- Long Usd/Zar
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
However, I feel now is the time to reverse these positions - again.
Why? Well, to me the weaker Usd was a temporary retrieve in any case. The Usd is coming back soon due to a leveling of positions and the markets overpricing of QE is US vs recovery in Europe. Hence , I believe we will see a relative shift in long term rates favouring the Usd.
I am going long the Usd.
* The China syndrome - soon in Australia?
Australia is to suffer on the back of continued Chinese tightening as well as continued weakening Chinese assetmarkets. According to research, Chinese GDP growth is 100% due to the domestic industry of making fake brands. At least that makes me quite worried. Top it off with a very centralised structure, high leverage, insane capital allocation and you have the recipe for a real bubble burst with a bang. On the positive side; Basel 3 will likely mean an increased allocation from banks into reserve currencies such as the Aud. Short term, however, Im a seller of Aud.
* Equities still in a range - but its about to move lower within it.
Equities will still be looking good from a capital allocation model point of view, but short term I believe the market has gotten ahead of itself. Europe is not out of the woods - not by far.
I am going short European Equity indexes.
* While Oil may very well be in short supply going forward, the Gulf issue is overplayed and so is the demand for now. Im going short Brent Oil.
* The Wheat panic rocket is falling back to Earth - ish. Beware of setbacks.
However, with the recent move and the Russian wheat export stop and bad harvests already discounted by the market and a very, very swift move higher. I am at least looking for a correction lower before we get a top out test of the former high. Caution warranted though. Proper strict riskmanagement should be applied, as always.
* SouthAfrica - the Worldcup is over and the shine has faded. Whats left? A corrupt government, trying to silence the press in order to make room for murky deals and yet more corruption. This country was meant to set an example for the rest of Africa, leading openness,transparency, education, social responsibility and growth. Now its heading the other way. Mandelas legacy is fading fast. On top of it, neither the World Cup, nor the Olympic games are rarely an economic success for the hosting country, rather the opposite. I doubt it will be different for South Africa.
I am buying Usd/Zar.
* Positions and position changes
- Took profit on my long Eur/Usd position, reversed.
- Sold Gbp/Usd.
- Took profit on my long Aud/Usd position, reversed.
- Sold Gbp/Jpy.
- Took profit on my long GLL ETF (short gold).
- Took profit on my long LOIL ETF (Long Brent Oil).
- Went long SOIL ETF (Short Brent Oil).
- Long Bear ETFS on European Equity indexes
- Long Usd/Zar
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
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